Texas Adds HSBC To Blacklist Of Banks Boycotting Oil And Gas

By Charles Kennedy - Mar 21, 2023

 

Texas has added HSBC to its list of companies that boycott the oil and gas industry, which could ban Texas government entities from investing in Europe’s largest bank and its funds and other products.

HSBC ended up on Texas’ list after the bank recently updated its energy policy, Texas Comptroller Glenn Hegar said this week.

As part of a policy to support and finance a net-zero transition, HSBC will stop funding new oil and gas field developments and related infrastructure, the banking giant said in December.

Motivating the inclusion of HSBC on Texas’ blacklist, Comptroller Hegar said on Monday, “HSBC’s new energy policy is a prime example of a broader movement in the financial sector to push a social agenda and prioritize political goals over the economic health of their clients.”

“HSBC’s policy clearly makes the firm a suitable candidate for listing under Texas law,” Hegar added. 

Texas, the largest oil-producing state in America, is leading the campaign against the ESG movement. Last year, the Lone Star State published a list of financial firms that could be banned from doing business with Texas, its state pension funds, and local governments. 

At the core of the dispute lies the growing ESG investment trend, which many financial firms have embraced amid criticism from shareholders and investors that they sponsor fossil fuels.

Texas and other Republican-led oil and gas states, however, see the ESG trend as an implicit attack on fossil fuels and a boycott of conventional energy resources, the revenues from which make up a large portion of state budgets in energy-producing states. 

Texas has already blacklisted financial firms, including some ESG funds managed by Goldman Sachs and JP Morgan, and has said they would be banned from doing business with the state. The blacklist includes the world’s biggest asset manager BlackRock, as well as BNP Paribas, Credit Suisse, Danske Bank, Jupiter Fund Management, Nordea Bank, Schroders PLC, Svenska Handelsbanken, Swedbank, and UBS Group. The list of funds is much longer. It includes nearly 350 funds, including Goldman Sachs Bloomberg Clean Energy Equity ETF, Goldman Sachs ActiveBeta Paris-Aligned Climate U.S. Large Cap Equity ETF, and JPMorgan U.S. Sustainable Leaders Fund.   

By Charles Kennedy for Oilprice.com