Company: HBCYF
Filing Date: 2025-02-20
Form Type: 20-F
Source: 0001089113-25-000040
Chunk: 94

Company: HSBC HOLDINGS PLC
Filing Date: 2025-02-20
Form: 20-F
Chunk 94
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. A number of clients have material undrawn balances that, if drawn, could significantly increase the financed emissions related to those clients. We expect to assess how to manage these exposures on a forward- looking basis as we progress towards our 2030 targets. In addition, for the intensity- based sectors, the emissions intensity is sensitive to material clients and changes to drawn balances year-on-year can therefore influence the trend. We continue to engage with and support our clients in their decarbonisation journey by providing financing and advisory services.

Oil and gas For the oil and gas sector, our analysis included scope 1, 2 and 3 emissions, including carbon dioxide and methane, for upstream and integrated companies. Our baseline and progress figures reflect combined on-balance sheet financed and facilitated emissions. We have set a target to reduce absolute combined on-balance sheet financed and facilitated emissions for our oil and gas portfolio by 34% by 2030 relative to our 2019 baseline. This is consistent with a global 1.5°C-aligned pathway, as defined by the IEA NZE 2021 scenario. We show in the chart our progress to date against our 2030 target. We also indicate the 2030 figure derived from the updated IEA NZE 2024 scenario, which suggests a 30% reduction relative to the 2019 baseline. In 2023, absolute combined on-balance sheet financed and facilitated emissions in our portfolio decreased by 46% to 23.2 million tonnes of carbon dioxide equivalent (‘Mt CO 2 e’) relative to the 2019 baseline, and by 27% from 2022 to 2023. The reduction was due to divestments and other strategic decisions, and temporary factors such as low loan drawdown levels, and subdued capital markets activity. A return to market conditions with clients increasing capital markets activity, or other factors that could lead to clients drawing down existing loans, will lead to increased financed emissions in our portfolio. Based on Dealogic data, capital markets activity for the sector increased by more than 15% in 2024 compared with 2023.

| Oil and gasMt CO2e | 2023 progressfrom baseline |
|                    | (46)%                      |

Power and utilities For the power and utilities sector, our analysis included scope 1 and 2 emissions for upstream power generation, and diversified utilities power generation companies. We focused on power generation companies because they control sector output, which has the most material emissions impact in the real