HSBC Suspends Executive for Climate Comments

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Bank’s head of responsible investing said risks were overstated.

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Mr. Kirk is being suspended while the bank undertakes an investigation, one of the people said.

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A spokesperson for HSBC declined to comment. Mr. Kirk didn’t respond to requests for comment.

The London-based bank has sought to position itself as a leader in sustainable finance, with initiatives such as a pledge to provide as much as $1 trillion of financing by 2030 to help borrowers cut their carbon emissions. HSBC has said its asset-management arm “treats climate change risk as a key feature of the investment decision-making process.”

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Last Thursday, Mr. Kirk gave a presentation titled “Why investors need not worry about climate risk” at a conference organized by the Financial Times. He said that markets appeared to share his attitude and one of his slides was headed: “Unsubstantiated, shrill, partisan, self-serving, apocalyptic warnings are ALWAYS wrong.” The Financial Times earlier reported Mr. Kirk’s suspension.

He argued that the financial and lifestyle effects of climate change would be “de minimis,” given economic growth and social adaptation.

“Human beings have been fantastic at adapting to change, adapting to climate emergencies and we will continue to do so. Who cares if Miami is six meters underwater in a hundred years? Amsterdam’s been six meters underwater for ages and that’s a really nice place,” he said.

“Twenty-five years in the finance industry, there’s always some nutjob telling me about the end of the world,” said Mr. Kirk, recalling late-1990s worries about the Y2K computer bug. A video of his speech was available on the newspaper’s FT Live YouTube channel.

“Central banks are particularly annoying because they haven’t spent enough time worrying about inflation and growth and why it’s going out of control, and have spent way too much time on climate risk,” he added, querying how those institutions modeled related stress tests .

Mr. Kirk has previously worked at Deutsche Bank and The Financial Times, and was hired by HSBC in late 2020.

Banks, asset managers and other financial institutions have come under pressure in recent years from investors and environmental activists to focus on climate change. The finance industry has been incorporating environmental, social and governance, or ESG, criteria into its models for investing, while some banks have been scaling back their lending to companies involved with fossil fuels. Trillions of dollars are being put toward climate-oriented funds and projects.

Senior figures at HSBC criticized Mr. Kirk’s analysis.

“I do not agree—at all—with the remarks made at last week’s FT Moral Money Summit. They are inconsistent with HSBC’s strategy and do not reflect the views of the senior leadership of HSBC or HSBC Asset Management,” Chief Executive Noel Quinn wrote on LinkedIn. “Our ambition is to be the leading bank supporting the global economy in the transition to net zero.”

Celine Herweijer, the bank’s chief sustainability officer, also distanced the bank from Mr. Kirk’s comments.

“As a global bank we understand we have a critical role, and responsibility, to help our customers and communities transition to a net zero future,” she posted on LinkedIn.

The campaign group Extinction Rebellion said on its verified Twitter account: “Seems a particularly good time to take your money out of @HSBC.
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As ESG has grown in importance, it has put banks in awkward positions. Last August, Businesshala reported that US authorities were investigating Deutsche Bank asset-management arm, DWS Group, after the firm’s former head of sustainability said it overstated how much it used sustainable investing criteria to manage its assets.

Quentin Webb contributed to this article.

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Credit: www.Businesshala.com /

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