The Church of England Pensions Board, managing £3.5bn in assets, will vote against directors at NatWest, Santander and HSBC at their upcoming annual meetings. The fund accuses the banks of materially backtracking on climate commitments, weakening policies, diluting financing targets for sensitive sectors, or abandoning previously stated goals. Laura Hillis, the fund's managing director for responsible investment, emphasized this action targets governance integrity, not companies failing despite best efforts. Voting against directors is typically a last resort, reserved for cases where banks dilute commitments that investors understood as part of their strategy and risk management approach. This move signals pension funds' continued focus on climate risks amid corporate retreats from earlier promises.

HSBC notably weakened its interim 2030 financed emissions targets for oil and gas and introduced exceptions for fossil fuel financing. NatWest softened fossil fuel financing policies while retaining its interim 2030 ambition to halve climate impact. Santander, a major lender to renewable energy projects, reviews lending policies regularly. These actions follow a broader trend where banks retreated from climate commitments, particularly after pushback in the US under President Trump. The pension fund's stance aligns with ShareAction, which urged institutional investors to vote against re-election of boards rowing back on climate targets.

While the pension fund's £3.5bn scale is modest, its governance influence through pension and endowment funds has historically shaped UK policy. The fund plans to monitor other banks' reporting and vote against directors at the next six weeks' meetings. This represents a concrete step in investor pressure, moving beyond behind-the-scenes conversations to public accountability for climate governance failures.