Sustainable finance
2023-05-11
Financing and investment policies
As a bank, we are led to finance a number of industries, some of which pose major environmental, social and governance (ESG) challenges. That’s why we have adopted sector policies laying down strict ESG criteria meant to govern our financing and investments in these sensitive areas.
In accordance with the United Nations Sustainable Development Goals, the Group has thus pledged to act as a catalyst in the energy transition, to combat deforestation and to safeguard local populations. More generally, our sector policies incorporate ESG criteria to protect the human rights of workers throughout the value chain, as well as local communities.
These policies apply to all our business lines, products and services, and in all countries in which we are located. Rolled out gradually since 2010 as part of our Corporate Social Responsibility (CSR) policy, they aim to assist our customers in their transitions towards sustainable practices for the climate, biodiversity and human rights. In May 2024, BNP Paribas updated its environmental framework, which includes the Group’s policies and commitments.
Promoting the energy transition
Three commitments between 2020 and 2025 toward a net-zero economy
-30%
of CO2 intensity of our financings for power generation.
-10%
of CO2 intensity of our financings for oil & gas extraction, production and refining.
-25%
of CO2 intensity of our financings for the automotive industry.
Our “Coal-fired power generation” sector policy
Released for the first time in 2010, this sector policy has been updated regularly over the years to incorporate criteria that are more binding. Its latest commitment, made in May 2020, announced a full exit from thermal coal by 2030 in European Union and OECD countries and by 2040 in the rest of the world.
Our "Mining industry" policy
Mining is a source of GDP for many countries and also supplies basic elements to most economic sectors. Many ores are also key to the energy transition, for example in playing a predominant role in electric vehicles or wind and solar power. The Financing and Investment Policy governs BNP Paribas’ activities in the mining industry, including within its strategy for exiting the thermal coal value chain.
Our "Oil & gas" sector policy
As part of its policy, BNP Paribas has stopped financing dedicated to oil projects since 2016. The Group has also discontinued its commercial relations with unconventional hydrocarbon specialists (shale gas, oil from tar sands) and no longer provides dedicated funding for projects to develop new oil or gas fields, regardless of financing methods. Moreover, BNP Paribas has stepped up its restrictions on financing ecosystems that are especially sensitive in Amazonia and the Arctic. In May 2022, for example, BNP Paribas extended its definition of the Arctic by adopting the definition of the Arctic Monitoring and Assessment Programme.
Our "Nuclear energy" sector policy
According to the International Atomic Energy Agency, nuclear power supplied 10% of electricity generated worldwide in 2020. Moreover, all of the IPCC’s “net zero” scenarios incorporate nuclear power into the projected energy mix. Through this policy, BNP Paribas wants to ensure that the projects that it helps finance are in compliance with global principles of monitoring and attenuating environmental and social impacts for the nuclear energy sector.
Combatting deforestation
Three key figures in the fight against deforestation
~2.5m
million trees planted as of the end of 2021,
thanks to the distribution of structured products indexed to an ESG thematic index
200,000
hectares of forests are expected to be preserved or restored in Kenya,
thanks to project Kasigau, funded as part of the annual offsetting of residual greenhouse gas emissions linked to Group operations
€4.3bn
in financing of companies helping to protect terrestrial and marine biodiversity as of the end of 2023
Our "Palm oil" sector policy
Since 2017, the palm oil policy has included an assessment of new palm oil plantations, based on the high-carbon-stock approach. The policy aims to protect forests possessing a high stock of carbon and is one of the financial sector’s most advanced policies.
Our "Wood pulp" sector policy
As an important source of revenues for thousands of persons, wood pulp production can also have environmental impacts, in particular on deforestation. BNP Paribas’ wood pulp policy is based mainly on the standards of the Forest Stewardship Council (FSC) and the Program for Endorsement of Forest Certification Schemes (PEFC) to ensure sustainable management of forests.
Our "Agriculture sector" policy
In February 2021, BNP Paribas incorporated new criteria into its agriculture policy to combat deforestation in Amazonia and the Cerrado. BNP Paribas now pledges to encourage its customers producing or buying beef or soy from Amazonia and the Cerrado in Brazil to have a zero-deforestation strategy in place by 2025 and to demonstrate their progress in a transparent fashion.
Safeguarding local populations and human rights
In accordance with the United Nations Guiding Principles on Business and Human Rights, BNP Paribas has developed a financing and investment policy designed specifically to govern transactions in the sectors of defence and security. While recognizing each country’s right to defend its interests and protect its national security, this policy takes into account the risks that are specific to this sector.
Since 2017, BNP Paribas has also pledged to no longer finance or invest in the tobacco sector, which the World Health Organization has identified as the number one cause of avoidable deaths.
100%
of BNP Paribas' sector policies incorporate human rights criteria
Our "Defense sector" policy
Released in 2010 and updated in 2017, BNP Paribas’ defence policy provides for strict exclusion criteria, particularly in weapons governed by major international agreements, such as antipersonnel mines or cluster bombs. It also provides for specific mechanism for protecting human rights, by refusing to finance the export of weapons to countries where the United Nations has found serious violations of children’s rights during armed conflicts.
Our exclusion list
As part of its sustainable development policy, BNP Paribas has drawn up a list of goods for which it excludes any transaction, due to the environmental or social risks they incur. This includes drift nets, asbestos fibres, tobacco and the production and trade in controversial weapons (as defined by the Group’s policy in the defence sector).