Amid pressure from investors and regulators over climate risks,Westpac announced detailed targets for the carbon emissions released by its big corporate customers - known as “financed emissions”. Under the policy,customers in these sectors will be required to develop credible plans for cutting their emissions.
In oil and gas,Westpac wants to cut its financed emissions by 23 per cent by 2030,compared with 2021. However,the bank will continue to provide corporate loans (as opposed to finance for specific projects) to existing oil and gas clients,if they have a “credible transition plan” by 2025.
Westpac also said it would consider financing new oil and gas projects if regulators said such projects were needed for energy security.
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Labor introduced its signature climate legislation to the House of Representatives on Wednesday,pledging to cut emissions by 43 per cent from 2005 levels by 2030. The government has refused to bow to pressure from the Greens,who wantfunding blocked for all fossil fuel projects.
On Wednesday,chief executive of Westpac Institutional Bank Anthony Miller said the bank was keen to work with clients to cut their emissions. This could include changes to their business operations,alongside the use of carbon offsets.
Under the policy,Westpac will aim to slash the emissions intensity of its electricity lending portfolio by more than 50 per cent by 2030,compared with 2021 levels.