We recognise that climate change is one of the biggest issues facing society.

As the UK’s largest financial services group, we can make a real difference to tackling climate change by helping to finance a greener future together. We think this will require new ways of living, working and investing for our business and our customers.

That’s why we’re setting ourselves an ambitious goal to accelerate working with customers, government and the market to help reduce the carbon emissions we finance by more than 50% by 2030 – the estimated equivalent of removing the emissions produced by almost a quarter of UK homes. See this infographic for an overview of all our sustainability commitments.

We know there is an urgent need to transition to a low-carbon future, grow the green economy and promote green finance for the future prosperity of the UK. To enable the transition, more will be required from all organisations and government: we do not have all the answers today, but we are committed to continuing to make progress.

The UK has made a sizeable commitment to transform its economy and society, and our strategy is in alignment with the global Paris Agreement and the UK’s net zero ambition.

We are a founding member of the Net Zero Banking Alliance (NZBA), a UN-convened, industry-led alliance of 43 banks across the world which – as part of the larger Glasgow Financial Alliance for Net Zero – aims to accelerate the transition of the finance sector and the global economy to net zero emissions by 2050. The alliance is accredited by the UN Race to Zero campaign.

The green economy in numbers... 

£1.4 trillion: the investment The Climate Change Committee estimates will be needed between 2020 and 2050 to reach net zero by 2050.

40% of this investment will be directed to the power sector.

24% of this investment will be needed in land transport to electrify the UK’s vehicle fleet.

£253 billion needed to improve home insulation and fit low-carbon sources of heat and hot water between 2020 and 2050.

Up to 400,000 people already work in the UK’s green economy.

Up to 2.5 million people could be needed to work in the sector.

See report page for statistic sources

Seizing the green growth opportunity

The transition to a low carbon economy – a ‘green’ economy – will support the UK’s recovery and promote long-term prosperity, while helping to make our planet more resilient. 

As the countdown to COP26 begins, we commissioned Oxford Economics to help share the overall story of the opportunities and challenges that the green economy presents for the UK.

Read the report

How we'll help finance a green future together


We want to help our customers make the lifestyle changes required in their homes, vehicles and investments by creating green products and services that make it easier for them to invest in tackling climate change.

We will also support businesses by financing their investments in the green economy, as well as helping to improve the energy efficiency of their buildings, vehicles and assets.

3 people talking in a garden nursery

Business

Be a leading UK commercial bank for sustainable growth, supporting our clients to transition to sustainable business models and operations and to pursue new clean growth opportunities.

Father and daughter embracing each other

Homes

Be a leading UK provider of customer support on energy efficient, sustainable homes.

Two people working in an allotment

Pensions & investments

We aim to offer customers sustainable investment choices and challenge companies we invest in to behave more sustainably and responsibly.

Electric vehicle being charged

Vehicles

Be a leading UK provider of low emission/green vehicle fleets. 

 

Child putting on wellies

Insurance

Be a leading UK insurer in improving the resilience of customers’ lives against extreme weather caused by climate change.

Abstract image of several green bottles

Our own footprint

Be a leading UK bank in reducing our own carbon footprint and challenging our suppliers to ensure our own consumption of resources, goods and services is sustainable.

trees

Green bonds

Be a leading UK bank in the Green/Sustainable Bonds market. 

Our pledges


We are taking action through an accelerated target to reduce our financed carbon emissions and further our purpose of Helping Britain Prosper.

  • Carbon emissions

    We commit to an ambitious goal to accelerate working with customers, government and the market to help reduce the carbon emissions we finance by more than 50% by 2030. 1

  • Operations target

    We have set a target of achieving net zero carbon operations by 2030.

  • Travel

    We will maintain travel carbon emissions below 50% of pre COVID-19 levels, embedding for the long-term the reduced levels of commuting and business travel seen during the pandemic and supporting colleagues to switch to low carbon transport.

  • Carbon dioxide

    We will work with the Woodland Trust to plant ten million trees over the next ten years to expand the UK’s carbon sink. During the lifecycle of the trees planted, 2.5 million tonnes of carbon dioxide could be absorbed, equivalent to the harmful emissions produced from eight years of UK waste management. 2

Our progress so far


We’ve made a good start, but there is more we can do.

  • In 2020, we more than doubled the number of electric vehicles financed through our Motor Finance and Leasing subsidiaries, Lex Autolease and Black Horse.

  • We launched a digital insight tool – The Green Building Tool – exclusively to the UK, which enables commercial real estate clients to assess the energy efficiency of their buildings, with the equivalent of around 600 football pitches of space already analysed.

  • To support our business customers on their sustainability journey, over 823 Lloyds Bank colleagues have undertaken training on climate change and sustainability-related risks and opportunities in collaboration with the University of Cambridge Institute for Sustainability Leadership. We are putting sustainability at the heart of our relationship teams’ support for businesses. 

  • As part of our partnership with the Woodland Trust, we are helping farmers and landowners transition to a low carbon future by offering preferential funding when planting more than 0.5ha of new woodland.

  • In 2020, we provided over £2.3 billion of green finance in Commercial Banking through our Clean Growth Finance Initiative, Commercial Real Estate Green Lending Initiative, Renewable Energy Financing and Green Bond facilitation. This increased our total green finance to over £7.3 billion since 2016. In addition, we have supported clients with over £1.8 billion of Sustainability Linked Loans since 2017.

  • Since the launch of this ambition in 2016, we have maintained our role as a leader for our UK corporate clients between 2016 and 2020, raising around £2.9 billion.

  • We will ensure our own operations are net zero by 2030. 

  • Offering customers more sustainable investment choices is a central part of our strategy, so we have invested £2 billion of Scottish Widows’ pension portfolios into the new ACS Climate Transition World Equity Fund, designed to help the global economy transition to a low carbon future. Our work with BlackRock to design this fund will help to engender positive change in the industry; incorporating environmental, social and governance risks into a portfolio can have a meaningful financial impact on performance.

  • Scottish Widows is to divest at least £440 million from companies that have failed to meet its environmental, social and governance standards. As one of the biggest pension providers in the UK, Scottish Widows’ new exclusions policy will benefit nearly 6 million UK savers.

  • In conjunction with the Energy Savings Trust we have launched a free online Home Energy Savings Tool accessed via the Halifax Green Living Hub. The tool is designed to help customers understand how they can improve the energy efficiency of their homes, what improvements and approximate costs and savings. The easy to use tool provides a tailored action plan for retrofit home improvements – with one created every 30 minutes and with an average potential saving of £264 per household.

Our operational climate pledges

Our ambition is to reduce our own environmental footprint and collaborate with suppliers to ensure our own consumption of resources, goods and services is sustainable. Our environmental programme focuses on measuring, managing and reducing our most significant impacts: carbon, energy use, business travel, operational waste, and water consumption.

Read more
 

Managing sustainability issues

Doing business responsibly in Lloyds Banking Group involves managing risk effectively.

We must make the right decisions and do the right things for our shareholders and our colleagues.

Lloyds Banking Group recognises the global challenge posed by climate change and other environmental issues; and its responsibility to reduce the environmental and social impacts of its business operations.

We expect our customers to comply with applicable international conventions, sanctions and embargoes, legislation, and licensing requirements. We also expect them to show a clear commitment to robust Ethical, Social and Environmental Risk (ESE Risk) management, including Health & Safety, environmental and social impact, and evidence of a good, track record for transparency in the way they manage these and other risks.

We are committed to managing the ESE risks associated with the financial services we provide across our business. We recognise that the Group’s major environmental and social impacts can arise indirectly through the provision of financial services to our customers.

During 2018, we reviewed our external sector statements to confirm that they align to our sustainability strategy and consider appropriate climate-related risk. The sector positions opposite are the output from the first phase of our work and include the position statement for coal introduced last year. In 2019, we will review these statements again and consider developing statements for other sectors and topics. We will also review ways to embed sustainability in the Group’s key policies.

News and insight

Lloyds Banking Group
12 July 2021
5 min read

Supporting the transition to a greener economy

The next decade will be crucial for protecting the planet for future generations, and financial services has a critical role to play by helping to incentivise the financing of the changes required.

Read more
Lloyds Banking Group
07 June 2021
6 min read

The transition to electric vehicles

We explore what’s stopping drivers from making the switch to electric vehicles (EVs), how green EVs are really, and how we can make the transition to EVs more efficient.

Read more

References

1. The number of dwellings was obtained from the Ministry of Housing, Communities & Local Government Statistical Release: Dwelling Stock Estimates: 2017, England dated the 24th of May 2018. Carbon emissions taken from The Committee on Climate Change report, ‘Reducing UK emissions – 2018 Progress Report to Parliament’. ‘Homes’ carbon emissions refer to the carbon emissions generated from the heating and electricity consumption of a property only. This estimation does not include carbon emissions generated by the travel activities or waste generated from the household.

2. Woodland Trust based on an average carbon sequestration rate of a tonne removed from the air for every four trees planted that stay in the ground for a 100 year period. Average annual UK waste management carbon emission is 0.3 million of carbon from the Department for Business, Energy & Industrial Strategy’s 2018 UK Greenhouse Gas Emissions, Provisional Figures.

Find out more about sustainability at Lloyds Banking Group

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Seizing the green growth opportunity

The transition to a low carbon economy – a ‘green’ economy – will support the UK’s recovery and promote long-term prosperity, while helping to make our planet more resilient. 

Find out more

Our sustainability commitments

Infographic setting out the Group's sustainability commitments on the journey to becoming a net zero business by 2050.

Find out more
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Our operational climate pledges

Our ambition is to reduce our own environmental footprint and collaborate with suppliers to ensure our own consumption of resources, goods and services is sustainable. 

Find out more