‘Not fit for purpose’: Credit Suisse criticised for ‘loopholes’ in new climate plan
Credit Suisse has published new sector-specific targets for reducing financed emissions, but is still using intensity-based rather than absolute emissions targets in most high-carbon sectors. Some key investors are arguing that the targets are not credibly aligned with science.
The multinational investment bank has today (14 March) published a new ‘Say on Climate’ plan as part of its latest annual sustainability report. The plan sees Credit Suisse increasing emissions reduction targets in the oil and gas sector and confirming sector-specific climate targets for automotive, aluminium, iron and steel, power generation and commercial real estate.
The oil and gas target entails a 49% reduction in absolute emissions by 2030, against a 2019 baseline. Capital markets activities are excluded from this target.
The other emissions targets have been set on an intensity basis with a 2030 deadline and a 2019 baseline. They are 64% for power generation; 35% for commercial real estate; 32% for iron and steel; 31% for aluminium and 51% for automotive.
Credit Suisse shareholders will be able to vote on the new plan at the firm’s annual general meeting (AGM) in April. Credit Suisse claims that the targets meaningfully contribute to its overall aim to halve investment-related emissions intensity this decade.
NGO ShareAction disagrees. It is urging investors to vote against the proposal and push, instead, for a stronger approach that would more meaningfully support Credit Suisse’s pledge to achieve net-zero financed emissions by 2050, following a 1.5C trajectory. It wants to see absolute – not intensity-based – emissions targets aligned with climate science; stronger exclusion policies for the most polluting industries and improved emissions disclosure frameworks.
On exclusion policies, Credit Suisse is estimated to have provided $3.3bn in 2021 to upstream oil and gas companies with plans to significantly increase production. It also has minimal exclusion policies on fracking.
ShareAction’s campaign and project manager Kelly Shields said: “Until Credit Suisse publishes a timebound plan to incorporate capital markets activities, which represent the bulk of its financing to top oil and gas expanders, in its disclosures and targets, shareholders must continue to press the bank for greater ambition on climate.
“The bank must urgently update its oil and gas policy, which is one of the weakest in the European banking sector, with a particular focus on fracking.”
And, for sectors other than coal, ShareAction has stated that the ‘Say on Climate’ plan is “not fit for purpose”.
ShareAction has been pushing Credit Suisse for more ambitious climate commitment updates for some time now. Last year, it co-filed a shareholder resolution with Ethos Foundation and 11 institutional investors in Credit Suisse, collectively representing €2.2trn in assets under management. The resolution pushed for science-based climate targets covering the bulk of the bank’s activities in high-emission sectors.
Credit Suisse is not the only financial firm under increasing scrutiny for its climate approach ahead of the 2023 AGM season. Convened by ShareAction, 30 investors wrote letters to Barclays, BNP Paribas, Credit Agricole, Societe Generale and Deutsche Bank earlier this year urging an end to direct finance for oil and gas expansion projects by the end of 2023.
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