Standard Bank commits to publish fossil fuel lending reduction targets

Standard Bank
Standard Bank
Image: FINANCIAL MAIL

Africa's biggest lender by assets, Standard Bank, committed on Friday to publish a strategy and short, medium and long-term targets for reducing its exposure to fossil fuels, following pressure from a group of investors.

However, Chief executive Sim Tshabalala had refused to be drawn earlier this week on whether such a plan would include a date by which the bank would exit fossil fuels entirely.

Sectors like oil, gas and coal accounted for 4% of Standard Bank's total lending and commitments in Dec. 2019, totalling around 67.4 billion rand ($4.85 billion).

Climate campaigners have been pressuring the bank to curb its financing to such sectors, but it has so far stopped short of ending financing for even new coal-fired power plants, putting it out of step with some of its peers.

A group of shareholders last month tried to push the bank to table a non-binding vote at its annual general meeting in May that would request it set and publish a strategy and set targets to reduce its exposure to fossil fuels on a timeline aligned with the goals of the Paris climate agreement.

In a statement, the bank said after meeting with the shareholders it confirmed it was committed to publishing both the strategy and the targets as part of its 2021 reporting to shareholders.

"We're deeply committed to supporting inclusive and sustainable development," Tshabalala said in a statement.

Tracy Davies, executive director of activist shareholder group JustShare, said shareholders were encouraged by the bank's commitment.

In an interview on Monday Tshabalala said he could not say for sure whether a date for the bank's exit from fossil fuels would be given, as it was still grappling with when this would be feasible by given they underpin many African economies.

"We're doing the analysis," he said, adding he could not say until this was complete. "If we put a date... it would have to be a date that's got credibility and integrity."

Would you like to comment on this article or view other readers' comments? Register (it’s quick and free) or sign in now.

Speech Bubbles

Please read our Comment Policy before commenting.