Which European banks ranked top for climate and biodiversity?

ShareAction report decries opacity in decarbonisation targets

French banks have come out on top on climate and biodiversity in a recent analysis by ShareAction.

In its report, Debt to the Planet, the financial NGO assessed 25 of Europe’s largest banks by total assets according to the S&P 2022 list, ranking them on biodiversity and climate metrics.

Three French banks – BNP Paribas, Societe Generale and Crédit Agricole – topped the rankings, with overall scores of 63%, 56% and 51% respectively. The best performing UK banks in the report were Barclays and Lloyds Banking Group, followed by HSBC and NatWest.

ShareAction’s Peter Uhlenbruch, director of financial sector standards, said despite progress, European banks are not moving fast enough to halt climate change.

“Without robust decarbonisation targets underpinned by credible fossil fuel policies, these banks cannot fulfil their commitments to align their businesses with net-zero and prevent the worst impacts of the climate crisis,” he said.

ShareAction has written to the CEOs of each of the banks with a set of tailored recommendations about how they can close loopholes in their climate and biodiversity strategies.”

The report found although most banks now have at least one decarbonisation target in place, these often fail to capture the bulk of banks’ financing to high-carbon sectors and do not always lead to absolute reductions of emissions. For example, only Barclays’ sectoral target includes capital markets activities.

ShareAction is recommending banks set targets that will guarantee a reduction in absolute emissions for the real economy. These must be backed by effective fossil fuel policies, it said, such as La Banque Postale’s requirement for companies to publish credible transition plans to phase out oil and gas by 2030 and Crédit Mutuel’s comprehensive coal phase out policy.

The report also found fossil fuel policies full of loopholes that make them unfit for alignment with 1.5C goal. The average fossil fuel policy scored 43%, with particularly slow progress on oil and gas policies, ShareAction said.

While the number of banks announcing asset financing restrictions on new oil and gas fields has doubled in eight months, banks are reluctant to introduce any restrictions for new oil and gas at the corporate level. This is despite the stark warning from the International Energy Agency that there is no room for coal expansion and new oil and gas fields if the world is to reach net zero by 2050. 

“Banks have made promises to investors and the public – it’s time they deliver on those commitments,” Uhlenbruch said.

Ranking of Europe’s 25 largest banks based on their performance on key climate and biodiversity metrics

Bank Country Grade Overall Biodiversity Climate 
BNP Paribas France B+ 63% 68% 60% 
Societe Generale France 56% 57% 56% 
Crédit Agricole France 51% 42% 55% 
ING Netherlands 51% 56% 48% 
Barclays UK 50% 38% 55% 
Lloyds Banking Group UK 50% 40% 54% 
Santander Spain B− 48% 36% 54% 
HSBC UK B− 47% 45% 48% 
La Banque Postale France B− 46% 20% 59% 
Rabobank Netherlands B− 46% 49% 45% 
BPCE France B− 46% 40% 49% 
NatWest UK B− 46% 27% 55% 
Credit Suisse Switzerland C+ 44% 50% 41% 
CaixaBank Spain C+ 43% 39% 45% 
UniCredit Italy C+ 43% 26% 51% 
Intesa Sanpaolo Italy C+ 42% 30% 48% 
Deutsche Bank Germany C+ 42% 43% 41% 
Standard Chartered UK 40% 25% 47% 
UBS Switzerland C− 38% 41% 37% 
Nordea Finland C− 36% 14% 47% 
Crédit Mutuel France C− 36% 12% 48% 
BBVA Spain C− 36% 26% 40% 
Commerzbank Germany C− 33% 20% 40% 
Danske Bank Denmark C− 33% 19% 40% 
DZ Bank Germany D+ 29% 14% 36% 
Source: ShareAction