Photo: Marche pour le climat 2019 – photo credit: Scouts et Guides de France
BNP Paribas Asset Management has announced that it will end its investments in new oil and gas company bonds, following pressure from campaigners including the Scouts and Guides of France.
This is a hugely significant development, as BNP Paribas AM becomes the first major global asset manager to adopt such a measure. As recently as April, BNP Paribas AM was one of the banks involved when TotalEnergies raised $4.25 billion on the bond market.
The new measure adopted by BNP Paribas could have significant consequences, given that bonds issued on the primary market are the main source of financing for companies developing new fossil fuel projects. BNP Paribas AM is one of Europe’s five largest asset managers, with nearly €600 billion in assets under management.
The Scouts and Guides of France (SGdF) spoke out against BNP Paribas’ fossil fuel financing earlier this year. In a letter to the Director General of BNP Paribas, SGdF Treasurer Guillaume des Courtis wrote: “The amounts of direct and indirect financing that you provide to the most emitting industries in the exploration and development of new fossil fuel reserves are clearly incompatible with the preservation of a livable world.”
Laudato Si’ Movement welcomes this important decision and celebrates the valuable contribution of the Scouts and Guides of France and other campaigners in helping to make this happen. However, there is further to go for the French banking giant.
While BNP Paribas’ asset management arm will no longer invest in new bonds issued by oil and gas companies, it will continue to invest in their existing debt and equity, subject to certain rules and exclusions. Furthermore, as Reclaim Finance has highlighted, this measure does not extend to companies involved in transporting oil and gas, nor to the development of new liquefied natural gas (LNG) export terminals.
BNP Paribas Group now needs to apply the same exclusions on new oil and gas company bonds to its other subsidiaries, including BNP Paribas Cardif. Other major banks also need to do the same, in particular Crédit Agricole Group and its subsidiary Amundi.
Last month, 70 Christian organisations in the UK, including several Catholic religious orders and charities, wrote to the CEOs of the five largest UK high street banks calling for an end to fossil fuel financing. Laudato Si’ Movement was among the co-authors of the statement.
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