Jesuits in Britain together with 10 other institutional shareholders have taken formal action at Barclays, asking the bank to phase out its financing of fossil fuel companies that are active agents in driving the climate crisis.

The group of 11 institutional investors which manage over £130billion includes Brunel Pension Partnership, LGPS Central, Sarasin & Partners and Folksam Investors. Coordinated by the responsible investment charity, ShareAction, they have filed a shareholder resolution at Barclays alongside over 100 individual shareholders. It will be voted on by investors at Barclays’ annual general meeting in May 2020.

This landmark resolution – the first climate change resolution filed at a European bank – requests that Barclays publishes a plan to gradually stop the provision of financial services (including project finance, corporate finance, and underwriting) to companies in the energy sector, and to gas and electric utilities that are not aligned with the goals of the Paris climate agreement.

Stephen Power of the Jesuits in Britain, said: “Climate change is the most pressing challenge the world faces. The Jesuits in Britain support the resolution to align Barclays with other banks taking steps to meet Paris targets, both in response to the increasing scientific evidence that effects of climate change are accelerating and for reasons of sound business sense. The scale of the challenge means large global banks should do all they can to help avert the severe financial risks that could result from a failure to meet the Paris goals.”

Since the Paris Agreement was signed in 2015, Barclays has provided more than US $85 billion of finance to fossil fuel companies and high-carbon projects such as tar sands and Arctic oil and gas. This makes it the world’s sixth largest backer of fossil fuels, and constitutes the highest level of fossil fuel financing of any European bank, exceeding its peers by over US$27 billion.

Mr Power explained: “The resolution seeks to ensure that major energy sector companies take the Paris targets seriously but also that the finance and banking sector do not allow deviation from them.”

In May 2019 a group of Barclays' investors backed a letter from ShareAction to the bank asking it to stop funding companies involved in coal mining or oil sands exploitation.

The proposal also encourages Barclays to consider the social dimension of the transition to a resilient and low-carbon economy, as per the Paris Agreement. This makes it the first climate change resolution to include a so-called ‘just transition’ ask in its supporting statement. Investors representing more than US $5 trillion have already expressed support for the just transition.

Given the systemic threats posed by climate change, and the rising regulatory scrutiny of banks’ resilience to accelerated decarbonisation and climatic impacts, this resolution supports the long-term economic interest of shareholders.