Barclays Urged to Cut Ties to Oil & Gas

Barclays faces calls from some of its shareholders to drop all support for oil and gas, as opposition to fossil fuel financing mounts.

Lobby group ShareAction said on January 8 it had co-ordinated 11 institutional investors and more than 100 individual shareholders to formally ask the UK bank to phase out fossil fuel funding.

The resolution – the first to be filed at a European commercial bank – will be voted on by investors at Barclays’ annual generating meeting in May. It calls for the bank to publish a plan to gradually scale back support, including project financing, corporate finance and underwriting, to energy companies that are not aligned with the aims of the Paris climate agreement.

“Since the Paris Agreement was signed in 2015, Barclays has provided more than $85bn of finance to fossil fuel companies and high-carbon projects such as tar sands and Arctic oil and gas,” ShareAction said in a statement. “This makes it the world’s sixth largest backer of fossil fuels, and constitutes the highest level of fossil fuel financing of any European bank, exceeding its peers by over $27bn.

A group of Barclays shareholders similarly put pressure on the bank in May last year to end the financing of companies involved in coal mining and oil sands production.

The investors backing the new resolution include Brunel Pension Partnership, LGPS Central, Sarasin & Partners and Folksam Investors. UK-based Sarasin made headlines in July when it sold 20% of its shares in Anglo-Dutch Shell, saying the oil producer was not doing enough to address climate change.

Activist shareholders have so far concentrated on urging the oil and gas companies themselves to improve their green credentials, but the focus of pressure is now shifting to the financial institutions that support the sector. The EU-owned European Investment Bank committed last year to limiting its ties with oil and gas by 2021, after a unanimous agreement between member state finance ministers.