HSBC saw pushback against its new chairman at the company’s annual general meeting (AGM) amid concerns about the lender’s progress on climate action.
Nearly 8% of investor votes opposed the election of Brendan Nelson at the meeting in London on Friday – an unusual result for a new chairman, who would expect almost unanimous support in their first year.
Just over 8% of votes also went against the re-election of James Forese as an independent non-executive director and chair of the group risk committee.
In comparison, last year’s AGM saw former chairman Mark Tucker receive less than 2% opposition, and Mr Foreses was backed by almost 100% of votes.
While neither resolution received the 50% needed to fail or attracted a substantial shareholder rebellion, the dissenting votes this year can still be seen as a protest against the board.
It came after activists criticised HSBC over a series of recent decisions to soften its targets for reducing the planet-heating emissions driven by its lending to polluting firms.
ShareAction, which campaigns for responsible investment, recommended investors vote against Mr Nelson’s and Mr Forese’s elections to the board ahead of the AGM.
During the meeting, a representative of the group also read out a letter signed by 70 climate scientists, which said the bank’s decision to weaken its climate ambitions was irresponsible and dangerous.
Responding to the results on Friday, Jeanne Martin, head of banking programme at ShareAction, said: “Shareholders have sent a strong message of dissent at HSBC’s decision to weaken its approach to coal, oil and gas, undermining long-term financial resilience and feeding into climate impacts people are already facing, from flooded homes and towns to heat stress and rising costs impacting the UK economy.
“The board must take this vote seriously.”
During the meeting, Mr Nelson agreed to meet with ShareAction and investors to engage over the issue, with the group welcoming the move.
But Ms Martin warned the bank would only be able to rebuild confidence among investors with “decisive action to halt further climate backsliding”.
Last May, HSBC announced it was pushing back its ultimate target to cut emissions across its supply chain to net zero by 20 years, from 2030 to 2050.
The bank cited a “slower pace of the transition across the real economy” and a “slower than envisioned” pace of decarbonisation globally.
Later in the year, it then watered down its near-term goal by setting its targets for reducing its 2030 financed emissions for polluting sectors – such as oil and gas – as a range, rather than a single figure.
Following in the wake of several major US lenders, HSBC became the first British bank to leave the banking sector’s global alliance for setting climate target last year.
The changes come amid a wider trend of lenders softening their green commitments in the face of a global breakdown in political consensus over climate action.
Other British banks have also faced criticism from climate activists, with both Barclays and NatWest being targeted by protesters and shareholder criticism over climate action at their AGMs in recent days.
In a statement, HSBC said: “We welcome shareholders’ support at our Annual General Meeting and thank investors for their continued engagement.
“Our updated Net Zero Transition Plan sets out our commercially grounded sustainability strategy to become a net zero bank by 2050, which reflects the realities of an evolving global transition and supports customers in hard to abate sectors and growth markets to address challenges.
“Now more than ever, it is critical we support our valued customers in their energy transition to ensure strengthened resilience and energy security.
“HSBC is well positioned to support our customers in the transition journey, using our extensive global footprint and strategic presence in the world’s fastest growing economies, helping to drive meaningful impact where it matters most.”
