HSBC Extends Net Zero Target to 2050

HSBC has revised its net zero carbon emissions target, pushing its original 2030 goal to 2050, citing slower-than-expected global economic shifts, regulatory challenges, and technological constraints. The decision aligns the bank with industry peers such as Goldman Sachs and Barclays, which have also set 2050 as their net zero target.

The revision follows HSBC’s full-year results and the recent appointment of Julian Wentzel as Chief Sustainability Officer in February. The bank stated that while it expects to achieve a 40% reduction in emissions across its operations, business travel, and supply chains by 2030, full net zero will require a more extended timeline and reliance on carbon offset mechanisms.

HSBC pointed at external market conditions, technological advancements, and policy frameworks as key factors affecting its ability to meet its original 2030 target. "There are fundamental prerequisites, outside of our control, which impact our ability to meet our 2030 interim financed emissions targets and ultimately reach our net zero ambition," the bank stated.

The bank's financed emissions targets (those tied to its lending portfolio) are undergoing an internal review, with results expected in late 2025. HSBC has emphasized that the revised target does not signal a major shift in its financing policies for industries such as oil and gas but rather a more measured approach to lending.

Despite the delay in achieving net zero, HSBC reaffirmed its commitment to reducing Scope 1 and 2 emissions by more than 90% from a 2019 baseline by 2030. It plans to achieve this through investments in renewable energy and efficiency measures.

Since 2020, HSBC has facilitated approximately US$393.6 billion in sustainable finance, an increase of US$99.2 billion from the previous year, as part of its broader goal to mobilize between US$750 billion and US$1 trillion in sustainable investments by 2030.

HSBC's revised strategy reflects broader trends in the financial sector, where banks are grappling with the complexities of decarbonization while maintaining flexibility in their lending practices. Other major institutions, including the Bank of England and the US International Development Finance Corporation, have also adjusted their net zero commitments, setting targets for 2040 or later.