Seven leading UK financial institutions that do not contribute to financing fossil fuel expansion have been identified as a panel suitable to hold billions in deposits for 83 British higher education institutions.
The Co-operative Bank, Coventry Building Society, Handelsbanken, Leeds Building Society, Skipton Building Society, Unity Trust Bank and Yorkshire Building Society have all met the strict fossil fuel-related criteria necessary to be accepted as part of the consortium.
The initiative was instigated and co-ordinated by the University of Cambridge Banking Engagement Forum (BEF) alongside collaborators at 81 Higher Education Institutions (HEIs) in the UK with the aim of identifying financial institutions that avoid contributing to fossil fuel expansion.
With seven deposit-taking institutions on board, it opens the way for billions in funding to be allocated in accordance with the International Energy Agency’s Net Zero Emissions scenario.
In February 2024, the HEI consortium challenged the UK banking sector to come up with new products that met stringent criteria relating to fossil fuel expansion.
The Request for Proposals invited banks and other financial institutions to present cash products that met stringent, research-based requirements, in a deliberate attempt to stimulate banks and debt markets to shift capital away from fossil fuel expansion.
Heather Davis, Head of Group Treasury in the University of Cambridge Finance Division, said: “Our affiliate institutions use a huge array of banking and investment services across a number of financial institutions. For many, their banking relationships are historic, going back centuries, but there was nothing in the market that met our requirement to avoid financing fossil fuel expansion. We challenged the banking sector to bring new ideas, and we are delighted to say that the banking institutions now part of the consortium have all delivered.”
Erin Squires, UCL’s Head of Treasury Management & Sustainable Finance, said: “It has been a welcome outcome to see this collaboration grow as it has, especially given the pressures facing the higher education sector and the broader global context. The level of engagement speaks to a shared sense of purpose and urgency on climate.”
