Cambridge could drop Barclays for a Greener Bank
Amid growing pressure, the university may be forced to break from this historical banking partner
Extinction Rebellion protests outside Barclays in 2020, photo by Tim Dennell
Cambridge has notified banks and asset managers that it is looking for an institution with robust climate policies to manage “several hundred million pounds” of assets. According to documents seen by the Financial Times, Cambridge University is “exploring opportunities to find financial products that do not finance fossil fuel expansion” as part of its “net zero engagement strategy with the banking sector.”
While Barclays chair Nigel Higgins, incumbent since 2019, has prioritised the reduction of financing carbon emissions, a college bursar told The Financial Times that Barclays was given “pretty robust challenges”, along with Lloyds over their sustainability policies, though he did add But that “Barclays always gets a harder time.”
While Barclays has provided financing to the University throughout most of its three-hundred year history under its current brand or via lenders it later acquired, the move is a success for student campaigners who have called for Cambridge to switch to a greener lender. In response to pressure from students and other affiliates, Cambridge has pledged to divest its £4 billion endowment from direct and indirect fossil fuel investments by 2030.
Our Analysis: Barclays under growing pressure
As we look ahead to Lent term and the rest of 2024, it seems likely that pressure for the University to end its connection with Barclays will only increase, especially as the distribution of bills at the start of this term will remind students where their tuition money is going. “We’re dealing with people who are likely going to be leaders of tomorrow,” a Cambridge college bursar told The Financial Times. “And the biggest of their concerns is climate change.”
“Barclays is clearly scared. [Barclays’s] new PR role is just another way for it to armour itself up.”
To date, Barclays’ ties to fossil fuels have been particularly strong. According to a report from the Rainforest Action Network, Barclays was the top European funder of fossil fuels between 2016 and 2022. According to Richard Brooks, the climate finance director at the environmental group Stand.earth, “Major banks hiring senior staff as spin doctors to green their bad images on climate issues rather than actually tackling their fossil fuel financing is utterly sickening, given the deaths in Hawaii, fires in Canada’s Arctic and extreme heat all over North America.” Since 2015, the bank has financed at least US $167 billion in fossil fuels, including over $2 billion in oil and gas drilling in the Arctic. As of 2021, Barclays is the seventh-largest funder of petroleum deposits called oil/tar sands in the world and the largest in Europe. Barclays has also provided over $29 billion for fracking, which is banned in the UK for the hazards it poses to the natural environment.
Yet in 2023, signs suggest Barclays may be forced to change under growing pressure. Recently, they have initiated a search for a new climate communications director after campaigners targeted the bank throughout much of last year for its support of carbon-heavy industries. In 2023, Barclays drew criticism over its Wimbledon sponsorship and faced boycotts at the grassroots level. In one case, a 72-year-old woman in Aylesbury refused to pay her county council tax in a protest urging the council to stop banking with Barclays.
The Cambridge branch of Extinction Rebellion at protests in London, April 2019, photo by Steve Eason
Recent, messaging from Barclays has thus emphasised this new focus in their hiring. One spokesperson told The Guardian that, “Barclays has made a significant number of sustainability hires in many teams, reflecting our commitment to work with customers and clients as they transition to a low-carbon business model.” Others have been much more critical of this recent move. Joanna Warrington from Fossil Free London said, “In recent years we’ve seen campaigning pressure expand beyond the oil giants like Shell and Equinor, on to banks and the massive funding they provide to companies building new oil and gas projects that would be impossible without it. Barclays is clearly scared. [Barclays’s] new PR role is just another way for it to armour itself up.
When it comes to the university, there has also been a growing focus on its ties to fossil fuels through its banking. A 2023 climate report by Nigel Topping, the UK's High-Level Climate Action Champion, discussed the University of Cambridge’s climate ties in response to a proposal from July 2022, when members of the University called for an end to “all sponsorship and collaboration with companies involved in the fossil fuel industry,” including Barclays.
This pledge itself was challenged, however, by a Freedom of Information (FOI) investigation conducted by the Make My Money Matter campaign determined that many universities, including Cambridge, that have publicly committed to removing fossil fuel money from their endowments continue bank with some of the world’s largest fossil fuel funding banks. Between April 2021 and April 2023, 85 universities confirmed that they bank with one of the five banking partners—Barclays, HSBC, Santander, NatWest, and Lloyds—who still invest in fossil fuels. (Nine universities, meanwhile, refused to provide details about their banks).
Although most of Cambridge’s 31 colleges bank with either Barclays or Lloyds, Cambridge has not publicised plans to sever ties with Lloyds despite Lloyds’s own fossil fuels connections. Between 2016 and 2022, Lloyds contributed around $15 billion to finance fossil fuels; however, the total amount is smaller than that of Barclays or other large UK banks. In September, Leeds University switched from Barclays to Lloyds, citing the fact that Lloyds has “the lowest fossil fuel investments of any of the major UK banks.”
All the same, these ties to fossil fuel funding banks appear to be increasingly difficult to justify amind growing pressure and awareness. As more non-university organisations, such as Christian Aid, the British Museum, and the Church of England, whose pension fund dropped its investments in BP and Shell, make a public stand against fossil fuels these banks may be forced to adapt. 2023 seems to have been the year of organisations attempting to move away from their involvement in fossil fuel funding, with more pressure seeming to be inevitable.