Dutch lender ING has announced a comprehensive climate strategy update, revealing plans to cease financing oil and gas exploration and production by 2040. In an interview with Reuters, ING's Chief Executive, Steven van Rijswijk, disclosed that the bank aims to triple its new lending to renewable energy over the next two years.
The move aligns with growing pressures from investors and regulators urging banks to adopt environmentally friendly practices. Many financial institutions are exploring ways to tighten lending criteria for companies in high-emission sectors unless they demonstrate a clear transition plan toward achieving net-zero emissions.
Citing the recent COP28 climate talks in Dubai, where nations committed to moving away from fossil fuels and enhancing the adoption of renewables, ING has adjusted its strategy accordingly. Under the new plan, the bank plans to reduce loans to upstream oil and gas by 35% by 2030, resulting in a 50% reduction in absolute emissions from its portfolio.
Van Rijswijk emphasized the bank's accelerated commitment, stating, “Initially, we had said we would bring down our upstream oil and gas exposure by 50% by 2040, and now we are saying that we're going to be completely out.”
The decision is also linked to an updated report by the International Energy Agency, which emphasized the necessity for advanced economies to phase out oil and gas by 2040 to limit global warming to 1.5 degrees Celsius.
As part of its updated climate strategy, ING aims to increase its renewables financing to €7.5 billion ($8.22 billion) by 2025, up from €2.5 billion in 2022. This target positions the bank to achieve its tripling goal five years ahead of the timeline pledged by governments at COP28.
This announcement follows previous steps taken by ING to strengthen its climate strategy and curb emissions associated with its financing. Last March, the bank announced restrictions on lending to clients involved in sectors like trade finance. In October, it called on governments to play a role by implementing more stringent decarbonization rules, particularly in sectors such as real estate.
Similar moves have been observed among other regional lenders, with France's Credit Agricole recently announcing its decision to cease financing new fossil fuel extraction projects and triple investments in renewables.
