A Barclays investment bank in London. Picture: REUTERS
A Barclays investment bank in London. Picture: REUTERS

London — A group of Barclays shareholders have filed what they say is the first climate change resolution at a European bank, taking aim at the lender’s support of fossil fuels.

Eleven institutional investors and more than 100 individuals urged Barclays to say how it will phase out financing energy firms that do not align with the Paris Agreement climate goals, according to a statement from UK non-profit organisation Share Action, which co-ordinated the proposal.

Shareholders will vote on the resolution, filed on Tuesday, at Barclays’ annual meeting in May.

Failure to move away from polluting industries “exposes the bank and its shareholders to heightened capital risks as decarbonisation accelerates”, said Natasha Landell-Mills, head of stewardship at Sarasin & Partners, which signed the resolution. “At a time of economic uncertainty, the board should not be taking on additional risks.

“We are working to help tackle climate change, and we meet Share Action and other shareholders regularly to update them on our progress,” Barclays said.

The bank has faced criticism for its continued relationship with fossil fuel companies. Barclays is the industry’s biggest backer in Europe and the sixth largest globally, financing $85.2bn in the three years after the 2015 Paris accord to restrict worldwide emissions, according to the environmental group Rainforest Action Network.

At 2019’s annual meeting protesters interrupted CEO Jes Staley’s comments on the bank’s green policies with chants of “tell the truth”.

Overall, though, investor pressure on climate issues has achieved mixed success. The average support for shareholder proposals on the environment and climate change is just 28%, up from 22% in 2013, according to a review of US companies by the consultancy firm EY. Shareholders passed some climate reporting resolutions at SA’s First Rand and Standard Bank Group 2019's.

At Barclays, retirement plan managers such as Brunel Pension Partnership and LGPS Central, as well as the Central Board of the Methodist Church, are among those who have signed the resolution. Data compiled by Bloomberg show none of them are top-30 investors in the bank.

Last January Barclays said it would restrict its coal financing business globally by ending direct financing of greenfield thermal coal mines and halting such funding of construction or expansion of coal-fired power stations.

Barclays is one of the founding signatories of the UN’s Principles for Responsible Banking, which launched in September to align finance firms with international efforts to address climate change and other environmental and social issues. However, the bank did not join 36 firms that also signed the Collective Commitment to Climate Action, which involves taking concrete steps to finance a low-carbon economy that’s required to limit global warming to below 2C

The bank said it underwrote £27.3bn (about R503bn) in green bonds and renewable financing in 2018. It ranked as the 10th largest arranger of green bonds that year, according to data compiled by Bloomberg.