Société Générale’s new management team has just presented its strategic roadmap, which includes major announcements in the fossil fuel sector  (1). After several years at the back of the pack, Société Générale has overtaken Crédit Agricole and BNP Paribas on gas, in particular, and has become one of the most advanced French banks in terms of climate change. Reclaim Finance is calling on Société Générale to confirm its ambition by ceasing to support oil and gas expansion through measures aimed at companies developing new fields.

At the presentation of the 2026 strategic plan, Slawomir Krupa, Société Générale’s new chief executive, announced major new commitments on fossil fuels.

Antoine Laurent, French advocacy lead at Reclaim Finance: "By treating gas in the same way as oil, Société Générale has gone further than other French banks such as Crédit Agricole and BNP Paribas, matching the approach of HSBC and ING."

Among the measures to be welcomed, Société Générale will stop financing new oil and gas fields that received a final investment decision after 31 December 2021. This follows the approach taken by BNP Paribas and is stronger than Crédit Agricole’s approach, which only applies to oil projects. For the first time, Société Générale has recognised the need to halt oil and gas expansion, as recommended by scientists in their scenarios for limiting global warming to 1.5°C.

Société Générale will also no longer finance pure-player companies in the exploration and production of oil and gas, with the exception of companies that are mainly state-owned, such as Saudi Aramco. This measure puts it ahead of its main competitors, with BNP Paribas adopting a similar measure, but only for oil production.

Société Générale also announced it will no longer finance new “midstream” infrastructure developments associated with new oil or gas fields, or fuelled by shale gas or gas from the Arctic.

Reclaim Finance calls on Société Générale to show consistency by extending this rule to all midstream projects, following the example set by La Banque Postale and Crédit Mutuel Alliance Fédérale.

Antoine Laurent, French advocacy lead at Reclaim Finance: "Société Générale has undertaken not to finance certain liquefied natural gas projects, such as the Papua LNG project, supported by Crédit Agricole as financial adviser. The new management must now double-down on its response to the climate emergency by ceasing to support companies such as TotalEnergies that are developing new oil and gas fields."

Société Générale has allocated nearly $98 billion to fossil fuels since the Paris Agreement – including $11 billion in 2022 (2) –  and will continue to support the companies developing new oil and gas fields and new transport infrastructure, allowing it to continue to support some of its biggest customers, including TotalEnergies. (3)

Reclaim Finance calls on Société Générale:

• to demand that companies stop developing new oil and gas fields, allocate the majority of their investments to sustainable energy, and reduce oil and gas production by 2030. (4)
• to be more ambitious in financing the energy transition y adopting a 2030 financing ratio target of 5:1 (five euros for sustainable energy for each euro for fossil fuels) (5).

Notes:

1. Société Générale Strategic Plan, September 2023
2. Société Générale has aligned itself with the commitments made by its European peers HSBC and ING, which have also stopped all direct support for some midstream infrastructure. It has not however met the ambition of France’s best performing banks: Banque Postale and Crédit Mutuel. See the Oil & Gas Policy Tracker
3. Banking on Climate Chaos, March 2023
4. Société Générale was the third biggest provider of finance to TotalEnergies between 2016 and 2022 after Crédit Agricole and BNP Paribas.
5. Despite the shortcomings of its existing policy, Société Générale has not made any new commitments regarding financing for the energy transition or for other carbon-intensive sectors such as steel and power generation. See: Reclaim Finance, Decarbonizing the steel sector, March 2023 and Reclaim Finance, Gaslighting: Financing fossil gas-fired power generation is leading Europe’s energy transition astray, April 2023.
6. Despite the shortcomings of its current commitments, the new management has no new ambitions when it comes to financing the energy transition, aside from the creation of a €1 billion fund with vague objectives.

This article was originally published on Reclaim Finance's website here.