Absa Group shareholders have agreed that the African bank should include in its reporting next year an assessment of its exposure to climate-change risk in its lending portfolios.
The company should also disclose opportunities to finance climate-change mitigation, shareholders of the Johannesburg-based lender voted at Absa’s annual general meeting. The board is not bound to comply with the vote.
In April, Absa said it won’t fund new coal-fired electricity generation projects unless there are extenuating circumstances that will be governed under strict guidelines. The lender is a signatory to the United Nations Environment Program Finance Initiative’s Principles for Responsible Banking.
Changes in Absa’s policy come as pressure mounts on financial institutions to cut lending to fossil fuel projects because of the carbon emissions they generate, contributing to global warming. South Africa relies on coal for almost all of its electricity and exports it to countries including China and India. Its carbon emissions rival those of the UK, an economy eight times its size.