Oversea-Chinese Banking Corporation (OCBC) has joined the United Nations’ Net-Zero Banking Alliance, it announced on Oct 25.
With this, the bank has begun developing a systematic plan to achieve net zero by 2050 and aims to unveil its sectoral financed emission targets by the first half of 2023.
The Net-Zero Banking Alliance was launched by the United Nations Environment Programme Finance Initiative (UNEPFI) in April 2021. There are currently 119 member banks across 41 countries, representing close to 40% of global banking assets amounting to US$70 trillion.
“We’re pleased to welcome OCBC Bank as the newest signatory to the Net-Zero Banking Alliance,” says Eri Usher, head of UNEPFI, “and we look forward to their contributions to the global banking community’s collective transition to net-zero.”
Helen Wong, group CEO of OCBC Bank, says: “We are already working to support a transition to net-zero carbon emissions for our customers in key sectors. Such a transition is a mammoth task; customers, industry peers and policymakers must all collaborate if a sustainable low-carbon world is to be realised at speed: It must be ‘all hands-on deck’.
Fellow local bank DBS joined the Alliance in October 2021.
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As a signatory, OCBC Bank commits to transitioning the operational and attributable greenhouse gas (GHG) emissions from its lending and investment portfolios to align with net-zero pathways by 2050 or sooner.
Within 18 months of joining, OCBC Bank also commits to set 2030 targets, or sooner, along with a 2050 target. OCBC Bank must also set intermediary targets every five years from 2030.
The bank must also publish annual reports detailing absolute emissions and emissions intensity. Within a year of setting targets, the bank must also disclose its progress in establishing a board-level transition strategy by sector.
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Decarbonising OCBC
In 2019, OCBC Bank became the first Southeast Asian bank to stop financing new coal-fired plants.
OCBC Bank’s sustainable finance portfolio reached $10 billion ahead of its 2022 target. It now pledges to grow its sustainable finance portfolio to $50 billion by 2025.
According to OCBC, the bank’s regional data centre contributes 40% of the bank’s carbon emissions in Singapore. It will implement a rack-based cooling system by the end of this year, reducing the facility’s emissions by over 400 tonnes annually, equivalent to removing close to 400 cars from the roads.
Earlier this year, OCBC Bank committed more than $25 million in decarbonisation efforts in Singapore, Malaysia and Greater China. According to OCBC, the investments will be used to deploy energy-efficient technology to reduce its carbon emissions, and solar energy systems that will increase renewables in its energy mix for powering operations.
OCBC says the investments will yield a carbon emission reduction of approximately 10,000 tonnes within the next four years. This is equivalent to removing close to 10,000 cars from the road.
As at 10.50am, shares in OCBC are trading 20 cents higher, or 1.73% up, at $11.73.
