Private bank Coutts is planning a 25% decrease in carbon emissions in its funds and portfolios by the end of next year. Patrick Brusnahan writes

The bank, which highlighted the plans in its 2020 Sustainability Report, incorporates ESG-thinking across the full investment process instead of providing specific offerings.

So far this year, the bank lowered its carbon footprint by 23% from its Coutts Invest funds.

It targets a 50% carbon emission reduce across its overall holdings by 2030.

Coutts head of Responsible Investing Leslie Gent said: “Accountability for driving change towards a more sustainable planet is something we think is missing from society. To date, there has been a lot of carrot and not much stick and we believe that regulators should harden their stance to help drive real change.”

The bank has excluded thermal coal extraction; thermal coal energy generation; tar sand; arctic oil and gas exploration from its direct investments.

Coutts head of Asset Management Mohammad Kamal Syed added: “We invest with purpose and integrity, and with a keen focus on sustainability. It’s extremely important that we do this well.

“It’s not enough to simply sit back and do nothing to make it worse. We all have to do something tangible. Defeating climate change, for example, isn’t about what we believe, it’s about what we do.”

Gent continued: “We’re committed to continually improving how we do this to ensure we’re making the biggest possible difference. Our clients deserve nothing less. This involves reviewing our overall process at least every two years.”

The UK-based private bank highlighted five “responsible areas” that it is keeping an eye on.

• Artificial intelligence: could help theough cutting down transport while impriving vehicle efficiency, carbon dioxide removal and low-carbon electricity;

• Plant based meat: online interest in “veganism” increase seven-fold between 2014 and 2019 according to The Vegan Society. Studies into the Beyond Burger, a plant-based patty, showed that it used 90% fewer greenhouse gases than a traditional beef burger, 93% less land and 99% less water;

• Plug-in planes: Electric passenger cars passed the five million mark in 2018, a 63% rise on the previous year. Planes are sure to follow;

• Renewable energy: an obvious choice, the sector keeps growing. Fossil fuels are going out of favour as 1,100 firms have pledged to divest from fossil fuels, and

• Green bonds: In the first half of 2019, these bonds were up 48% year-on-year in terms of value, reaching a total of $118bn.