Why has HSBC Pushed its Net Zero Target Back by 20 Years?

HSBC, one of the world's largest banks, announced a substantial revision to its climate goals in its 2024 Strategic Report. 

In 2020, HSBC set the goal of reaching net zero across Scopes 1, 2 and 3 by 2030.

It has now revised this to 2050, and says that “progress in reducing emissions in the Scope 3 supply chain component is proving slower than we anticipated”.

The report was released on 19 February 2025, just days after the appointment of its new Chief Sustainability Officer Julian Wentzel on 7 February. 

HSBC removed the role of Chief Sustainability Officer from its executive committee in November 2024 which was followed by Celine Herweijer stepping down.

The company has also begun a review of its interim financed emission targets for 2030 and policies associated with this. 

Reasons for HSBC’s net zero delay

In the report, HSBC cites several factors as reasons for its net zero change:

• Carbon offsets: HSBC says that it expects a 40% reduction across its operations, travel and supply chain by 2030 so reaching net zero would need heavy reliance on carbon offsets. It is taking into account the SBTi’s latest best practice on carbon offsetting.
• Slower global pace of change: “Progress in reducing emissions in the Scope 3 supply chain component is proving slower than we anticipated, driven mainly by the slower pace of the transition across the real economy,” the report says. Diversification of the energy mix, technological advancements and market demand for climate solutions are not progressing at the pace HSBC expected. 
• Policy and regulations: HSBC’s report explains that it is “limited by, and cannot on our own overcome, the present lag in policy measures and the overall slower pace of the transition.”

HSBC’s report says that it remains on track to reduce its Scope 1 and 2 emissions by more than 90% by 2030 from a 2019 baseline. 

It plans to achieve this through a programme of energy efficiency initiatives and significant investments in renewable power. 

HSBC’s financed emissions targets

“To the extent our customers are facing challenges, especially in light of the slower pace of the transition, there is no real benefit to society in simply sending those customers to another organisation that may be less committed to supporting their transition,” HSBC explains in its report. 

It aims to support both new and existing customers that are making positive steps towards a net zero economy, but says that “there are fundamental prerequisites, outside of our control, which impact our ability to meet our 2030 interim financed emissions targets and ultimately reach our net zero ambition.”

HSBC aims to publish the results of its review in the second half of 2025. 

However, it has made progress on sustainable finance – it has provided and facilitated US$393.6bn since the beginning of 2020, an increase of US$99.2bn from 2023. 

This is part of HSBC’s aim to provide and facilitate between US$750bn to US$1tn of sustainable finance and investment by 2030.

What are other major financial institutions doing?

HSBC is not alone with its new 2050 net zero goal. 

Other major financial institutions with net zero goals for 2050 include:

• Barclays
• Citigroup
• Goldman Sachs
• JPMorgan Chase
• Lloyds Banking Group
• NatWest
• BlackRock

In fact, financial institutions with net zero goals before 2050 are rare. 

The Bank of England and the US International Development Finance Corporation, both governmental institutions, aim to achieve net zero by 2040. 

HSBC is also not the only financial institution to make a change in its overall sustainability goals – BlackRock withdrew from the Net Zero Asset Managers initiative (NZAM) on 9 January 2025 saying that its membership “caused confusion regarding BlackRock’s practices and subjected us to legal inquiries from various public officials.”

NZAM has since suspended its activities for review.

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