Two Local Government Pension Scheme (LGPS) pools – Brunel Pension Partnership and LGPS Central – have joined 28 other investors in writing to five European banks urging them to stop directly financing new oil and gas fields by the end of this year.
Responsible investment charity ShareAction coordinated the letters, which were addressed to Barclays, BNP Paribas, Crédit Agricole, Deutsche Bank and Societe Generale. The group of investors, with combined assets of more than $1.5trn, expressed concern in the letters that new oil and gas fields may jeopardise the global path to net zero and hold back the renewable energy transition.
The letters also highlighted that asset financing for new oil and gas represents only 8% of total financing to top oil and gas expanders. Therefore, the investors urged the banks to also focus on companies behind new fossil fuel fields.
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Jeanne Martin, head of the Banking Programme at ShareAction, said: “These investor-backed letters should be a wakeup call to banks that have made net-zero commitments. First, they must stop directly financing new oil and gas fields.
“Second, banks must urgently turn their attention to the companies that are enabling new oil and gas fields from being discovered and developed. As the letters point out, direct financing is only the tip of the iceberg.”
Both the LGPS pools and the London Pensions Fund Authority signed all five letters, while the Merseyside Pension Fund and West Yorkshire Pension Fund signed some of them.
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