The 2025 Annual Report of HSBC Holdings outlines a major strategic shift toward supporting the global transition to a low-carbon economy.
As one of the world’s largest banking institutions, HSBC is embedding sustainability into its financing, operations, and governance frameworks while strengthening resilience against evolving global risks. The report highlights how the bank is leveraging its scale to accelerate decarbonization across industries while maintaining long-term financial stability.
HSBC’s sustainability performance in 2025 is defined by large-scale financial commitments and steady progress toward its long-term net zero ambition. The bank aims to become a net zero institution by 2050 and has positioned sustainable finance as the core driver of its climate strategy.
In 2025, HSBC provided and facilitated $102 billion in sustainable finance and investment, bringing the cumulative total to $495.6 billion since 2020. This places the bank well on track toward its target of mobilizing between $750 billion and $1 trillion by 2030, indicating that a significant portion of its goal has already been achieved.
HSBC aims to reduce thermal coal financing drawn balance exposure from a 2020 baseline by at least 25 percent by 2025, and aim to reduce it by 50 percent by 2030.
HSBC’s thermal coal financing drawn balance exposures for 2023 and 2024 were $0.6 billion and $0.5 billion, respectively.
Since 1 January 2020, HSBC provided and facilitated a cumulative $437.9 billion of sustainable finance and $57.7 billion of ESG and sustainable investing. This included 39 percent where the use of proceeds was dedicated to green financing, 11 percent to social financing, and 14 percent to other sustainable financing. It also included 24 percent of sustainabilitylinked financing and 12 percent of net new investment flows managed and distributed on behalf of investors.
Rather than focusing only on reducing its own operational emissions, HSBC’s approach emphasizes supporting clients in their transition to a low-carbon economy. The updated Net Zero Transition Plan in 2025 outlines revised interim financed emissions targets and reinforces the bank’s role in enabling decarbonization across industries. Sustainability is integrated into the broader business strategy, including risk management and governance, with ESG metrics embedded into executive remuneration and decision-making processes.
The bank is leveraging technology to support sustainability outcomes, with more than 100 AI-driven use cases and around 85 percent of employees using AI-enabled tools to improve efficiency and productivity. Overall, HSBC’s sustainability progress is most evident in the scale of its financing activities, with nearly $500 billion already mobilized, highlighting its role as a key financial enabler of the global energy transition.
Driving the Net Zero Transition Through Sustainable Finance
HSBC’s environmental strategy, as part of its sustainability goals, is centered on its role as a key enabler of global decarbonization. Through its Net Zero Transition Plan, the bank is aligning its financed emissions with science-based pathways consistent with limiting global warming to 1.5 degrees Celsius.
A major focus is supporting high-emission sectors such as energy, transport, and heavy industry. HSBC provides tailored sustainable finance solutions, advisory services, and transition capital to help clients reduce carbon intensity while maintaining business continuity.
The bank has enhanced its ESG disclosure practices, improving data collection and reporting for Scope 3 emissions, which represent the majority of its climate impact. Its long-term target includes achieving net zero across its own operations and supply chain by 2030.
In parallel, HSBC collaborates with policymakers, regulators, and global institutions to expand green finance ecosystems, support carbon markets, and scale clean technology investments. Internal initiatives such as renewable electricity sourcing and energy efficiency improvements further reinforce its environmental commitments.
Beyond internal operations, HSBC is promoting financial inclusion by expanding access to digital banking services and financial literacy programs. These efforts are designed to reach underserved communities, improve economic participation, and strengthen long-term financial resilience.
In 2025, HSBC provided project financing for the construction and operation of the 632MW Greater Changhua 2 Offshore
Wind Farm in Taiwan, owned and developed by Orsted.
ESG Reporting and Accountability
HSBC continues to align its sustainability disclosures with leading global frameworks such as the Task Force on Climate-related Financial Disclosures and the Global Reporting Initiative.
The 2025 report reflects improved transparency in ESG metrics, particularly in tracking financed emissions and climate-related risks. By linking sustainability goals with financial performance and risk management, HSBC ensures that ESG considerations are embedded into its long-term strategy.
The 2025 Annual Report demonstrates how HSBC is positioning itself at the center of the transition to a sustainable economy. By combining sustainable finance, inclusive growth initiatives, and rigorous risk management, the bank is building a resilient model for future growth.
FASNA SHABEER