Climate emergency declaration

Friends Provident Foundation recognises that business as usual risks climate breakdown with profound consequences for people and planet. We view the prevention of runaway climate change as an eco-socio-economic challenge and prerequisite to achieving our objective of a sustainable and fair economy.

The scientific evidence is clear that without rapid and far-reaching changes in energy, land use, transport, buildings, industry, and the economic system itself, we face man-made climate catastrophe and a new extinction event.

CLIMATE EMERGENCY DECLARATION – ANNUAL STATEMENT 2021

In September 2019, we published a Climate Emergency Declaration stating our view that “the prevention of runaway climate change is an eco-socio-economic challenge and prerequisite to achieving our objective of a sustainable and fair economy” and that we believe “it is the responsibility of every institution, business, investor and employer to transition their purpose and operations to be consistent with keeping global heating below 1.5°C.”

We made commitments covering investments, grants and operations, which are available on our website, including to report annually on progress as part of our annual report. In 2020/21:

  • We used our influence as a shareholder to “promote a just and net-zero carbon transition”. This included co-filing a shareholder resolution at HSBC in January 2021, along with 14 other institutional investors. The resolution was coordinated by ShareAction and called for a net-zero transition plan and timetable to divest fossil fuels, in line with the climate science. We withdrew it in March following negotiation with HSBC on the wording of its management resolution, which commits HSBC to alignment with the Paris climate agreement, including short and medium-term science-based targets and to divestment from coal.

At the HSBC AGM in May, the resolution passed with 99.7% of the shareholder vote. Regular meetings are being held with HSBC as it develops its coal policy and wider climate strategy. Further action could be taken in 2022 if they are inadequate.

Throughout 2020/21, we have also been using our shareholder influence to engage energy utility companies to adopt formal just transition strategies to accompany net zero plans, securing the world’s first strategy from SSE plc.

  • We have used our influence with asset managers and the market to “ensure active and high standards of shareholder engagement on climate change”. These standards featured heavily in our ‘ESG investing olympics’ tender for a new asset manager, and subsequent ‘state of the sector’ report and market recommendations.

We have engaged one of our asset managers to act on climate misinformation by one its largest holdings, Alphabet, the parent company of YouTube and Google. Our manager requested YouTube de-prioritise content featuring climate denialism in a similar way to extremist content and stop it from being monetised. A policy was announced and implementation is being monitored.

  • We have particularly favoured investments in “companies whose business model focus is on net-zero carbon transition”. Our social investments have a focus on community energy and include Riding Sunbeams, Awel Wind Co-op, and Egni Solar Co-op. Our mainstream investments include a new manager with investments in renewable energy, green bonds and energy transition.
  • We committed a strand of our grant work to ‘fair transition’, to address the risk of ‘stranded people’ and ‘stranded communities’ in terms of skills and economic utility, including as a result of the rapid and far-reaching changes needed to decarbonise the economy. We view a fair transition as a necessity for a rapid and resilient net-zero transition.

In 2020/21, we gave a grant of £101,200 to Community Energy England to support ‘transitioning to a fairer, decentralised, decarbonised and democratic energy system’ and £30,000 to Power for People for its Local Energy Bill campaign. We also gave a grant of £252,707 to the Womens’ Budget Group for its ‘Feminist Green New Deal’ programme and £50,000 to 350.org for its ‘Green New Deal Rising’ programme for youth leadership.

  • We have used our influence to support public policy engagement. In 2021, we match-funded a Climate Coalition campaigner to advocate for community energy in the run up to COP26. We also helped mobilise some of the 75 signatories to an open letter in support of the Environmental Audit Committee’s recommendations on community energy.
  • Whilst the pandemic has disrupted the delivery of some operational commitments, we have:
    • reduced our catering carbon footprint by switching to meat-free catering;
    • signed up to the ‘Climate Perks’ commitment from climate charity Possible to offer staff paid ‘journey days’ to encourage low-carbon holiday travel;
    • engaged our property manager and supported them to introduce building-wide recycling and basic energy efficiency measures; and,
    • reviewed our travel policy to privilege public and sustainable transport.

We will build upon the progress made in 2020/21 and continue to deploy our resources and use our influence to help accelerate the transition.