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Border to Coast Pensions Partnership, Royal London Asset Management, and Friends Provident Foundation, have today (May 30) laid out clear expectations for the banking sector to help ensure a just transition.  

The investor collaboration has launched ‘Investor expectations on just transition for the banking sector’, as part of ongoing engagement with four banks: Lloyds, Barclays, NatWest, and HSBC. 

The engagement goal is for the banks to introduce either a standalone just transition plan or explicit incorporation of just transition into existing climate plans.  

To date, two banks have committed to take the requested action, a third has included just transition ambitions in its net zero plan, and the fourth has stated support for just transition principles. 

The expectations will be used in more granular engagement with the banks during 2024, covering what the investors want to see in the emerging plans.  

They include: 

  • Develop and implement a responsible decarbonisation strategy for existing products and portfolios, such as mortgages, ensuring that decarbonisation is achieved without excluding customers and mitigates ‘stranded customer’ risk. 
  • Integrate just transition into regional corporate banking decarbonisation strategies and identify geographic areas with high exposure to transition risk, seeking to mitigate ‘stranded community’ risk. 
  • Develop partnerships with public banks and community development finance institutions to provide blended finance solutions to support place-based just transition. 
  • Integrate just transition into client transition plan assessments and include sector specific expectations in client engagement covering workers, customers, communities, and supply chains. 
  • Recognise global disparities between developed and emerging markets in client transition plan expectations and assessments, with differentiation in timeframes where appropriate. 

Just transition is the integration of the social dimension into decarbonisation strategies by mitigating social risks, seeking social opportunities, and a focus on place-based impacts. 

The engagement programme is being supported by the LSE Grantham Institute’s new Just Transition Finance Lab. 

Colin Baines, Stewardship Manager at Border to Coast, said:  

“The integration of just transition enables investors and businesses to address systemic threats to long-term stability and value creation and supports the delivery of a rapid and resilient transition to net zero.   

We are pleased with the positive response our engagement has received to date and the commitments leading banks have made. As ambition is turned into action, we will use our investor expectations to engage and assess their emerging plans.” 

Carlota Garcia-Manas, Head of Climate Transition and ESG Engagement at Royal London Asset Management, said:  

“Just transition as a requirement of the 2015 Paris agreement has become a key objective of various governments and investor climate initiatives and is emerging as a benchmark for net zero transition plans. Our investor expectations are aligned with these initiatives and will assist leading banks to establish best practice.” 

Charlie Crossley, Investment Engagement Manager at Friends Provident Foundation, said:  

“Banks are at the heart of the economy and have a critical opportunity to contribute to a just transition, both via capital allocation and support for customers to transition. By integrating just transition, we hope banks can help reduce the risk of stranded communities, workers, and customers, and support place-based transitions.” 


  • Access the full paper here: Investor expectations on just transition in the banking sector.
  • Based in Leeds, Border to Coast is the largest LGPS (Local Government Pension Scheme) pool in the UK. It is owned by 11 Local Government Pension Schemes (‘Partner Funds’) and offers them investment opportunities across equities, fixed income, private markets, and global real estate. The Partner Funds have c.£64bn in investments, of which Border to Coast is responsible for £47.9bn. Collectively, they represent 2,700 employers and over a million members.    The Partner Funds are Bedfordshire, Cumbria, Durham, East Riding, Lincolnshire, North Yorkshire, South Yorkshire, Surrey, Teesside, Tyne and Wear and Warwickshire.    
  • Established in 1988, Royal London Asset Management is one of the UK’s leading fund management companies, providing investment management solutions to both wholesale and institutional clients such as not-for-profit organisations, local authorities and the insurance sector. Royal London Asset Management manages £162 billion of assets as at 31 December 2023. It invests in all major asset classes including UK and overseas equities, government bonds, investment grade and high yield corporate bonds, property and cash. 
  • Friends Provident Foundation is an independent charity that uses its endowment towards a fair and sustainable economic system that serves people and planet – connecting, funding, supporting, and investing in new thinking to shape a future economy that works for all.
  • In March 2024, Colin Baines was appointed as a Visiting Senior Fellow at the LSE Grantham Institute to support the work of its new Just Transition Finance Lab.  
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