Sustainable Finance
As a financial institution, one of the ways we can make an important contribution to sustainability is through our lending and investment.
We manage the potential social and environmental risks associated with our lending and investment by following international standards of good practice, such as the Equator Principles which apply to project finance. HSBC has also developed its own polices for lending to socially and environmentally sensitive sectors.
We provide financial services that help stimulate solutions to social and environmental challenges, for example, climate change and access to clean water. HSBC aims to be at the forefront of the development of sustainable business, by actively looking for opportunities that have an environmental and social benefit as well as a viable economic return.
Sustainability risk
HSBC considers managing the environmental and social impacts of providing finance to our customers as part of business as usual. We track and rate every corporate customer around the world that operates in an industry sector with sensitive environmental and social issues.
There are some businesses we simply won't finance - for example unsustainable logging in rainforests or operations in UNESCO World Heritage Sites.
In 2003, HSBC adopted the Equator Principles, a set of voluntary guidelines that help financial institutions assess and monitor the environmental and social impacts when providing specific loans to large projects. HSBC voluntarily extends the Principles to export finance loans and other facilities where the use of proceeds is known to be directly related to a project.
In addition, HSBC has developed a series of risk policies for sensitive sectors, including Chemicals, Energy, Forest Land and Forest Products, Freshwater Infrastructure and Mining and Metals. These policies cover a wider range of financial services than lending and are applied regardless of the value of the transaction or size of the business.
Financing change
Solutions to the social and environmental challenges the world faces require financial solutions in order to be realised. This also presents a significant business opportunity. As one of the leading global financial institutions, HSBC can provide a wide range of services that help governments, companies and individuals respond to these challenges. Our work helps tackle issues such as poverty and access to finance through our involvement in Microfinance and extending China's rural bank network, and environmental challenges for example in the water sector, and climate change through initiatives such as the Climate Principles.
Related case studies
Winds of change, Paul's Hill, Scotland
Wind is currently the most viable renewable energy source in the UK. Paul's Hill is one of two wind farms financed by HSBC in Scotland.
Entrepreneurship, one rickshaw at a time
Shukla's husband was a rickshaw puller. He rented a rickshaw for 25 to 30 rupees per day and earned around 2,200 rupees per month.
