Financial institutions must immediately cease all financial services to companies that are unable or unwilling to transform their activities to align them with a 1.5°C trajectory. However, companies not meeting the exclusion criteria should not be overlooked. If these companies want to engage the transformation necessary to align themselves with a 1.5ºC trajectory, they have no time to lose.
Financial institutions must incentivise this transformation through robust engagement policies founded on specific and time-bounded demands to deploy long-term 1.5ºC alignment strategies and immediate emission reduction measures to halve emissions by 2030.
These engagement goals must take precedence over personal interests and business arrangements between large groups. Strong conflicts of interest are thwarting shareholder engagement initiatives for climate. Reclaim Finance calls on investors to join collective engagement initiatives such as Climate Action 100+. However, participation must be proactive and should complement, rather than replace the adoption of internal engagement strategies.
Reclaim Finance believes that shareholders, but also bondholders, banks, and insurers can influence corporate behaviour. We call on financial institutions to adopt the following measures.