Shareholder activism is poised to escalate pressure on major banks to uphold their climate commitments, with a campaign group, ShareAction, preparing to challenge the re-election of chairs at institutions perceived to be backtracking on environmental goals. The move comes amid a broader trend of financial firms reassessing their net-zero strategies, fueled in part by political shifts and economic pressures.
ShareAction will release detailed reports in the coming weeks assessing the climate policies of 34 of the world’s largest lenders. The UK’s largest banks – HSBC, Barclays, NatWest, and Lloyds – are among the first to be scrutinized, as they are due to publish their annual reports by the end of February. Barclays’ report is scheduled for release on Tuesday, .
The campaign will target chairs whose institutions are seen to be weakening their climate pledges. While ShareAction acknowledges that shareholder votes are unlikely to result in the removal of any bank chair, the organization believes that even a small reduction in the typically high levels of support (98-99%) for re-election can send a powerful message to directors and the wider financial sector. “These directors are getting nodded through with 98-99% of the vote,” said Kelly Shields, ShareAction’s senior campaign manager on its banking programme. “Even a small amount knocked off of that can send quite a strong signal, and it does make it a bit more personal. That director hopefully feels responsible and feels emboldened to act, or at least engage with investors on the issue.”
This increased scrutiny follows a period of significant change within the financial industry’s approach to climate finance. The return of Donald Trump to the White House last year is cited as a key factor, with his administration’s anti-green agenda emboldening climate deniers and increasing pressure on banks to finance fossil fuel companies. This has contributed to a wave of withdrawals from the UN-backed Net Zero Banking Alliance (NZBA), which required members to align their lending portfolios with net-zero emissions targets by 2050.
Several major banks, including JP Morgan, Citigroup, and Goldman Sachs, as well as UK lenders Barclays and HSBC, have exited the NZBA. The alliance ultimately dissolved in , signaling a broader retreat from ambitious climate goals within the banking sector.
HSBC, in particular, has faced criticism for scaling back its climate ambitions. Last , the bank announced it was delaying key parts of its climate goals by 20 years and weakening environmental targets as part of a revised bonus structure for its chief executive, Georges Elhedery. This move sparked concerns that financial incentives were being prioritized over environmental responsibility.
The situation at HSBC mirrors a similar trend observed at BP, where a strategic U-turn away from green investments triggered a significant shareholder revolt. In , 24% of shareholders voted against the re-election of outgoing Chairman Helge Lund, the highest level of opposition in the company’s history. Legal & General, a major shareholder, publicly opposed Lund’s re-election, citing concerns over BP’s shift back towards oil and gas. This revolt followed BP’s decision in to slash renewable spending and increase investment in its core oil and gas business.
The investor discontent at BP extended beyond the chairman’s re-election. The company’s climate U-turn was seen as a betrayal of its previous commitments and a short-sighted gamble on fossil fuel demand. Data from revealed that BP held $18 billion in net debt, highlighting the financial strain the company was under even as it increased its reliance on fossil fuels.
These shareholder revolts at both BP and the potential actions targeting bank chairs demonstrate a growing willingness among investors to hold companies accountable for their environmental commitments. While the immediate impact of these votes may be limited, the symbolic message is clear: backtracking on climate goals carries consequences. ShareAction hopes to build on this momentum, rallying both new and existing supporters within the investment world to push for greater financial stability and a prioritization of “people and planet.” Shields stated, “We really want banks to reassess this and do what’s needed to make sure that we’ve got long-term financial stability and are prioritising people and planet.”
The coming months will be critical as banks release their annual reports and face shareholder votes. The outcome of these engagements will likely set the tone for the industry’s approach to climate finance for years to come, and will be closely watched by investors, regulators, and environmental groups alike.
