Net-zero: energy transition and climate action
At the heart of BNP Paribas Group’s company purpose is its ambition to become a leader in sustainable finance. For that reason, BNP Paribas has made major advancements and commitments in addressing the climate crisis and advancing the energy transition. Whether supporting our individual customers wishing to renovate their home to be more energy efficient or by helping institutions make investments with a positive climate impact, the Group supports a wide range of players, actions and innovations designed to support clean energy throughout supply chains, cut emissions, and meet our clear objective: finance a net-zero economy by 2050.
“As a founding member of the Net-Zero Banking Alliance, we are committed to aligning our credit and proprietary investment portfolios with clear objectives and science-based methodologies. Achieving this goal is a challenge not only for BNP Paribas but for the entire banking industry, as no bank can do it alone.”
Ambitious interim targets in the highest emitting sectors
By aligning our clients’ net-zero ambitions with sustainable financing and investment solutions, BNP Paribas has demonstrated the role it plays at the centre of the real economy in the transition to a net-zero economy. With the Climate Analytics and Alignment report, the Group directly addresses how it can assist the transition of three highly emitting sectors: power generation, oil & gas, and automotive. Although those three sectors represent only 7% of the Group’s financing, thanks to the early engagements taken by BNP Paribas since 2011, their significant impact on the environment makes them key to successfully financing the transition.
To achieve the 2025 targets, the Group will leverage the PACTA methodology that it helped develop in open-source collaboration with other financial institutions and in particular, through the Low Carbon Transition Group. This group of low carbon experts will work with our clients to find the financial solutions they need. Fully understanding the challenges facing each of our clients, the 250 professionals of the Low Carbon Transition Group will work across the BNP Paribas Group and the wider financial market to meet those challenges and unlock their transition to net-zero.
BNP Paribas has pledged to dedicate at least 200 billion euros to supporting large corporate clients’ transition to a low carbon economy by 2025, and €350bn in sustainable savings across its commercial and investment banking business lines.
in loans and bond issues
covering environmental and social topics for corporate clients by 2025
A history of concrete commitments in the most sensitive sectors
These interim targets on the pathway to promoting clean energy and reducing emissions are only the latest over the last several years of strong commitments to contribute to the fight against climate change. Since 2015, BNP Paribas has taken several key steps towards ensuring the optimal management of our activities in the most sensitive sectors and to limit global warming in line with the objectives of the Paris Agreement and in order to finance the transition towards a net-zero economy by 2050, despite geopolitical uncertainties.
The Group commits to progressively aligning its credit portfolio with the objectives of the Paris Agreement.
BNP Paribas ceases all new financing of coal-fired power plant projects.
BNP Paribas no longer provides any new financial services to unconventional oil and gas specialists (shale gas, shale oil, oil sands, Arctic).
BNP Paribas accelerates the timeframe of its complete coal exit: by 2030 in OECD and EU countries, and by 2040 in the rest of the world.
BNP Paribas commits to reducing its exposure to oil and gas exploration and production by 10% by 2025 (which has since been increased to 12%).
The Group publishes its first Climate Analytics and Alignment report, including both ambitious 2025 targets for the power generation, oil & gas, and automotive sectors; as well as a pioneering commitment to reduce our credit exposure to upstream oil production by 25% by 2025, in comparison to 2020.
Funding and investment policies to guide our activities
The Group’s sectoral policies governing our environmental impact also extend to several other sensitive sectors, including mining, pulp and paper, nuclear power, defence and palm oil.
Collaborative and scalable: stepping up the pace of the energy transition
Four climate-related analysis pillars: Governance, Strategy, Risk Management and Indicators & Goals
Financing solutions to support the energy transition
BNP Paribas supports all its clients - corporate, institutional, entrepreneurs and individuals - in their transition to a more sustainable business model.
The world’s second largest green bond player in 2020 according to Bloomberg, with €10.8 billion as joint bookrunner, BNP Paribas actively participates in the growing Sustainability Linked Loans market, with €3.8 billion of financing based solely on environmental criteria by the end of 2020. In 2021, BNP Paribas created the Low-Carbon Transition Group: a team of experts that supports the Group’s corporate clients in their transition to a low-carbon economy.
in Green Bonds in 2020
as joint bookrunner according to Dealogic
Supporting environmental initiatives
Financing innovation and clean energy
To encourage the development of renewable energies, the Group has more than doubled the amount of its financing in 5 years. Funding has increased from €7.2 billion at the end of 2015 to €18.6 billion at the end of 2021 - and in 2022, the Group committed to reach a €30 billion target by 2025. In addition, BNP Paribas recently dedicated €250 million to equity investments in start-ups that bring major innovations in the fields of the energy and ecological transition.
The environment, a key issue for the BNP Paribas Foundation
The Group’s Foundation supports several initiatives in favour of the environment and the energy transition, in particular research and raising public awareness of the challenges due to climate change.
3 key commitments by BNP Paribas for the energy transition by 2025
of financing for the renewable energy sector
in funding invested in start-ups committed to the energy transition
In funding to support large corporate clients’ transition to a low carbon economy
Photo credits: ©Sue Wetjen, ©Chris Zielecki