Barclays announced revisions to its Climate Change Statement, outlining a shift in its financing approach away from certain segments of the energy sector. The banking giant stated it will no longer provide project finance or direct financing to clients involved in upstream oil and gas expansion projects or related infrastructure.
Under the updated policy, Barclays will now expect energy clients to develop transition plans or decarbonization strategies by January 2025, aligning with global efforts to mitigate climate impacts. The company emphasized its continued support for an energy sector in transition, with a heightened focus on diversified energy companies investing in low carbon initiatives.
Laura Barlow, Group Head of Sustainability at Barclays, highlighted the significance of the challenge posed by climate change, affirming the bank's commitment to collaborating with energy clients as they navigate decarbonization efforts. Barlow stated, “Addressing climate change is a critical and complex challenge. We continue to work with our energy clients as they decarbonize and support their efforts to transition in a manner that is just, orderly and addresses energy security.”
Additionally, Barclays announced restrictions for new energy clients engaged in expansion, particularly targeting non-diversified energy clients involved in long lead expansion projects. The bank further specified additional constraints on unconventional oil and gas ventures, including those related to Amazon and extra heavy oil.
Barclays had previously pledged to finance $1 trillion of Sustainable and Transition Finance by 2030, reaffirming its commitment to mobilize capital towards sustainable initiatives. Daniel Hanna, Head of Sustainable Finance at Barclays' Corporate and Investment Bank, emphasized the importance of capital in driving the energy transition. Hanna stated, “Capital is critical to the energy transition, to decarbonize hard-to-abate sectors for the world to reach net zero emissions and create a resilient economy.”
Barclays' announcement comes amidst growing global attention on the financial sector's role in facilitating climate-friendly investments. With the publication of its Transition Finance Framework, the bank aims to provide transparency regarding its efforts to mobilize sustainable finance while maintaining its position as a prominent advisor and financier in the global clean energy landscape.