HSBC Suspends Top Banker for Accusing Policymakers of Overstating Climate Risk

By Emel Akan
Emel Akan
Emel Akan
reporter
Emel Akan writes about business and economics. Previously she worked in the financial sector as an investment banker at JPMorgan. She graduated with a master’s degree in business administration from Georgetown University.
May 23, 2022 Updated: May 25, 2022

A top executive at HSBC Bank has been suspended after criticizing central bankers and policymakers for exaggerating the financial risks of climate change.

The bank, according to a Financial Times report, has suspended Stuart Kirk, who is global head of responsible investing at HSBC’s asset management division. Kirk gained attention at an event last week by accusing climate change alarmists of exaggerating the financial risks in an effort to “out-hyperbole the next guy.”

Speaking at a Financial Times conference on May 19, Kirk compared the climate crisis to the Y2K bug, or Millennium bug, which was projected to create a massive computer malfunction at the turn of the year 2000.

Kirk said that during his 25-year banking career, “some nut job” was continuously lecturing him about the end of the world.

“Unsubstantiated, shrill, partisan, self-serving, apocalyptic warnings are ALWAYS wrong,” he wrote on a slide accompanying his speech. Kirk’s presentation was titled “Why investors need not worry about climate risk.”

Kirk’s statement was quickly condemned by several activists in the financial industry, who claim that climate change poses a serious threat to financial assets.

People familiar with the event’s planning told the Financial Times that the bank’s top executives had approved the presentation’s theme and content before Kirk’s address. However, the executives later distanced themselves from Kirk, stating that his remarks didn’t reflect the views of the bank and its asset management arm.

“I do not agree–at all–with the remarks made at last week’s FT Moral Money Summit,” Noel Quinn, group chief executive at HSBC, wrote on LinkedIn.

“They are inconsistent with HSBC’s strategy and do not reflect the views of the senior leadership of HSBC or HSBC Asset Management. Our ambition is to be the leading bank supporting the global economy in the transition to net zero.”

Kirk’s comments come as banks and fund managers face increasing pressure to support the transition to renewable energy and defund the fossil fuel industry, despite a growing global energy crisis.

“Central banks are particularly annoying,” Kirk said during his speech. He criticized central bankers for devoting little attention to inflation and economic growth while fretting excessively about climate change.

Kirk didn’t respond by press time to a request for comment from The Epoch Times.

The world’s largest central banks, including the Federal Reserve, are rushing to put models in place to assess the financial risk posed by the alleged climate crisis. They want banks to undergo climate stress tests because policymakers believe the financial system is vulnerable to this risk. They also intend to mobilize more money for green and low-carbon investments.

However, free-market advocates argue that the U.S. central bank’s role shouldn’t be to pick winner and loser industries. They also claim that policymakers seek to exploit financial regulations as a cover for defunding the fossil fuel sector.

Recent New York Fed research discredited the narrative that climate change represents a systemic risk to financial stability. The study showed that severe weather conditions such as wildfires, hurricanes, floods, and droughts over the last quarter-century had almost no effect on banks.

Emel Akan
reporter
Emel Akan writes about business and economics. Previously she worked in the financial sector as an investment banker at JPMorgan. She graduated with a master’s degree in business administration from Georgetown University.