The financial services giant Societe Generale of France, Paris unveiled today significant progress in its sustainability objectives. The milestones achieved happened ahead of schedule and set new ambitious targets on how the company is supposed to achieve greater environmental and social impact. Societe Generale had surpassed its €300 billion target in financing environmental and social activities between 2020 and 2025, earlier than scheduled. Taking the lead on sustainable finance, Societe Generale set a new ambition: €500 billion dedicated to sustainable finance by 2030, in the face of major challenges for climate and social equity.
The Chief Executive Officer of Societe Generale, Slawomir Krupa, especially highlighted the commitment of the bank to sustainable development and the driving force for the environmental transition it can assume that financial institutions must take up for the benefit of all. Societe Generale continues to strengthen its contribution to sustainable development in service of our customers, supported by our culture of innovation, our leadership in ESG, and our conviction as to the crucial role that a responsible bank can play in environmental transition challenges,” Krupa said.
The bank had, initially, set a target of raising €300 billion in 2022, a goal that was later expanded to incorporate not only environmental objectives but also social ones, thereby embracing a more holistic notion of sustainable development. The success of its previous target now makes Societe Generale set out its ambitious goal: €500 billion in sustainable finance by 2030. At first glance, the new target is a number. But then there’s much more: ambition, because it is a milestone step on the road to systemic change in financial services by advancing capital into projects that reduce the effect of both the climate crisis and social challenges.
A balanced approach is seen in the new €500 billion goal, where 80% will be targeted for financing environmental activities, while 20% will focus on social objectives. This ensures Societe Generale maintains its stance on environmental sustainability while engaging in critical aspects that address pressing social concerns. Commitment by the bank in low-carbon energy, sustainable real estate, and low-carbon mobility assumes paramount importance in the transition to a net-zero economy. In addition, the bank has added €100 billion of its target sustainable bonds, increasingly viewed as a potent tool in steering private investment to climate-related and social initiatives.
The bank also progresses with success in reducing its exposure to fossil fuels through Societe Generale. The bank said it already reduced its upstream oil and gas exposure by over 50% compared with 2019, beating its target of achieving this by 2025. In addition, it significantly cut its involvement in the thermal coal sector, with exposure now making up less than 0.1% of the overall financing portfolio. These reductions are a clear manifestation of Societe Generale’s commitment to ensuring its financing activities align with the goals and ambitions of the Paris Agreement while supporting a global transition toward a low-carbon economy.
In line with this, Societe Generale is a member of the NZBA- a UN-convened coalition of banks committed to progressing net-zero emissions in the financial sector. Since Societe Generale became one of the founding members of the NZBA, the group made specific commitments to reduce its financed emissions to net zero by 2050, with interim targets on key emissions-intensive sectors such as oil and gas, power, cement, steel, and transportation. These sector-specific targets, which now include 10 high-emitting sectors, are designed to drive meaningful reductions in financed emissions while helping to decarbonize the global economy.
To support these efforts, Societe Generale is expanding its sustainable finance offering, offering its clients innovative solutions and advisory services to help them transition toward low-carbon business models. The bank builds on its skills in renewable energy and sustainability, combining them for a cross-sectoral approach to support the entire value chain in becoming more decarbonized. The strategic approach will henceforth align financing activities with the broader goal of achieving global net-zero emissions, thus causing capital flows to be directed towards sectors and projects that are likely to yield the most impact in reducing emissions and sustaining development.
These efforts involve social sustainability, as the group has set aside some of its financing to support projects that will deliver substantially improved access to and better education, health care, housing, energy, water and sanitation, basic infrastructure, and information communications. Societe Generale understands that the environment and social equity go hand-in-hand, and its new goal mirrors that understanding. In pursuing both environmental and social aims, the bank hopes to contribute to a more equitable, sustainable future for all.
Krupa added that Societe Generale’s sustainable finance strategy is something that does not happen overnight. It is a commitment that takes time, collaboration, and collective action within the financial sector. “This year, we have taken new steps in the execution of our strategic roadmap with concrete progress reflected in the progressive reduction of our fossil fuel exposure.”. We are therefore continuing to expand our action, actively supporting our clients themselves in their transitions with adapted solutions and an enhanced sustainable finance offering, he said. “I remain convinced that the transition to a low-carbon and sustainable economy will require collective and coordinated action in which Societe Generale is involved on a daily basis,” he added.
As the bank forges ahead with a new target of €500 billion, Societe Generale is also making a stride as a leader in sustainable finance, mobilizing its resources and expertise to drive global transformation toward a low-carbon, sustainable economy. Societe Generale’s ambitious goals and its iron will in regard to environmental and social sustainability make it a grand example for the financial service industry and contribute to making this world more livable and less skewed to a small group of people.