TSB and Aviva Investors plot pathway to net-zero carbon

Major retail bank TSB has unveiled its plans to reach net-zero by 2030, after cutting operational emissions by 66% during 2020. At the same time, Aviva Investors has revealed its plans to decarbonise its real assets portfolio.

TSB and Aviva Investors plot pathway to net-zero carbon

TSB is developing science-based targets to support its net-zero vision

TSB announced its 2030 net-zero target in July 2020, as part of a revamped responsible business strategy called the ‘Do What Matters Plan’. The publication of the plan came alongside a commitment to switch to 100% renewable electricity for all buildings.

Today (13 January), the bank revealed that it had completed the renewable electricity switch and recorded a 66% decrease in operational (Scope 1 and 2) emissions year-on-year. It outlined measures to reduce gas use for heating, which accounts for 94% of remaining operational emissions, by implementing efficiency measures

TSB also outlined plans to tackle emissions from two of its other major non-financed sources – travel and the supply chain. On the former, the company recorded an 80% year-on-year drop in company car emissions during 2020 as a result of Covid-19. It is developing plans to discourage company car use in the coming years, so that related emissions never rise above 50% of pre-Covid-19 levels. It has also committed to replacing the entirety of its company car fleet with pure electric and hybrid models by 2026.

As for supply chains, TSB will spend time benchmarking its Scope 3 emissions so it can develop science-based targets within 24 months. The Science Based Targets initiative requires businesses to develop Scope 3 targets if they want their goals to be certified as 1.5C-aligned. The bank has also agreed to partner with several of its largest suppliers, including IBM, ISS and Communisis, to co-develop pathways to net-zero and to share best-practice learnings. In the longer-term, measures will be designed to help customers choose low-carbon products and services, thereby reducing their spending-related emissions.

“We know that reducing the impact on the environment is important to TSB customers and colleagues, and there’s real enthusiasm in our business to share what we’re doing,” TSB’s executive sponsor for environmental impact Suresh Viswanathan said. “It’s right that we start by getting our own house in order, measuring our impacts and targeting the right actions.”

Other major banks with net-zero targets more ambitious than the UK’s 2050 deadline include Lloyds Banking Group and Natwest, which is targeting ‘climate-positive operations by 2025

Aviva Investors

In related news, Aviva Investors has this week published its plans for reaching net-zero across the entirety of its £47.3bn Real Assets Platform by 2040 – a commitment it made by signing up to the Better Buildings Partnership’s Climate Commitment. The commitment covers not only the real estate and infrastructure covered by the Platform’s portfolios, but Aviva Investors’ private debt services also.

Aviva Investors will funnel £2.5bn into low-carbon into low-carbon and renewable energy infrastructure and buildings for the sector, as well as creating £1bn of climate-transition-focussed loans for utilities and the built environment, by 2025. For context, the business provided £200m of climate-transition-focussed debt during 2020.

Also detailed in the plans are commitments to help the real estate assets in the Platform reduce their carbon intensity by 30% and energy intensity by 10%, and to increase the clean energy generation capacity of financed assets in the UK and Europe from 730MW to 1.5GW. The commitments have a 2025 deadline and a 2020 baseline.

To the former of these commitments, Aviva Investors has been running a Smart Buildings Programme since 2016. The programme provides real estate firms with retrofitting services and with smart technologies to monitor and minimise energy use. To date, the initiative has reduced occupiers’ energy bills by £1.8m.

Aviva Investors’ chief executive officer Mark Versey said the real assets sector must “quickly move on from high-level pledges to demonstrate meaningful action”, in line with the scale of the climate crisis.

“The goals of our net-zero commitment are ambitious and, most importantly, set out material proof-points that we can be measured against.”

Sarah George

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