COP 29: Societe Generale Boosts Sustainable Finance Goal

In a significant move following the COP29 conference, Societe Generale has announced its revised ambition to drastically push forward its environmental initiatives. The bank now aims to achieve a robust €500bn (US$525bn) in sustainable finance commitments by 2030, reinforcing its leadership in eco-friendly investments.

This new financial target aligns with the bank's established Environmental, Social, and Governance (ESG) policies. Slawomir Krupa, CEO of Societe Generale, reinforces the bank's dedication to green transformation, stating: "Societe Generale continues to strengthen its contribution to sustainable development in the service of its clients, supported by our culture of innovation, our ESG leadership and our conviction of the crucial role that a responsible bank can play in the challenges of the environmental transition."

Banking on continued progress

Societe Generale proudly reports that it has outdone its own expectations by reaching a prior target of €300bn (US$316bn) earmarked for sustainable finance for the period 2022-2025 well ahead of schedule. Inspired by this achievement, the bank has now introduced an even more ambitious goal for 2024-2030.

This goal is divided into €400bn (US$422bn) for financing, which includes advisory services, and an additional €100bn (US$105bn) intended for sustainable bonds.

The bank outlines an 80% commitment towards financing environmental projects with the remaining 20% dedicated to social causes. Significant funding will support essential sectors such as low-carbon energy, sustainable real estate, and low-carbon mobility, among other critical areas of environmental innovation.

The bank's broader strategy also includes aligning its portfolio with the objectives of the Paris Agreement and having joined the UNEP-FI Net Zero Banking Alliance as a foundational member back in 2021. Key targets set by the bank include a dramatic reduction of fossil fuels exposure:

• Societe Generale's methodical exit from the thermal coal sector now reflects less than 0.1% of its total portfolio as of the end of 2023.
• At the closure of the second quarter in 2024, the bank achieved over a 50% reduction in upstream exposure to oil and gas compared to figures from 2019, aiming for an 80% reduction by 2030. Additionally, the overall greenhouse gas emissions are targeted to drop by 70% by 2030 in relation to 2019 levels.
• The bank also completed aligning 12 of the most carbon-intensive sectors as dictated by the Net Zero Banking Alliance, achieving set alignment targets for 10 sectors within the scheduled timeframes.
• Firm commitments to transparency are seen in the publication of comprehensive progress reports detailing the bank’s alignment processes.

Slawomir adds: "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 also continuing to broaden our action by proactively supporting our clients in their own transitions with adapted solutions and an enhanced sustainable finance offering, while supporting the emergence of new players and new technologies."

Investing in the future through innovation

The acquisition of a majority stake in Reed Management by Societe Generale culminates in the creation of REED, cementing its position as a premier investor in innovative energy transition enterprises.

This strategic move underlines the bank's dedication to fostering the growth of emerging leaders in the green economy, supported by a substantial €1bn (US$1.05bn) fund earmarked specifically for these ventures.

Previous investments and partnerships also exemplify Societe Generale's commitment to innovation, including a fruitful collaboration with EIT InnoEnergy to support eco-conscious startups and a strategic financial undertaking with the Polestar Capital Circular Debt Fund, Europe's unique private debt fund focused on the circular economy.

Furthermore, a partnership with Schneider Electric aims to assist mid-sized companies in their carbon reduction journeys, supplemented by an agreement with the International Finance Corporation, part of the World Bank Group, to further promote sustainable practices globally.

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