Swiss National Bank Disposes Shares in Chevron Corporation
The Swiss National Bank (SNB), one of the world's largest investors in equities, has announced its divestment from US oil firm Chevron, marking a significant step in the global shift away from fossil fuels. This move comes amid growing political pressure on central banks to align their investments with climate goals.
According to the SNB's latest filings for Q1 2025, the bank no longer holds a stake in Chevron, which previously amounted to around $0.7 billion in Q4 2024. The SNB continues to hold a significant $1.4 billion stake in Exxon, as reported in the same filings.
The SNB's decision to divest from Chevron is not surprising given its commitment to managing appreciation pressures on its currency by selling foreign exchange and investing in highly liquid assets such as US equities. The bank's equity investments are market-neutral and passive, aiming to represent individual stock markets in their entirety. However, the SNB does not invest in stocks or bonds of companies whose products or production processes significantly violate broadly accepted societal values.
Central banks, including the SNB and the European Central Bank (ECB), are under increasing scrutiny for their role in financing fossil fuel projects. This pressure is driven by demands for stricter regulations and binding rules that exclude lending and investment in fossil fuel projects to meet global climate targets like those in the Paris Agreement.
The ECB faces similar pressures, with a recent report showing that it has added nine fossil fuel companies to its guarantees system. This news, coupled with the SNB's divestment from Chevron, underscores the growing momentum towards divesting from fossil fuels.
Advocacy groups and reports have highlighted the potential risks associated with continued financing of fossil fuel expansion. These projects lock in high emissions for decades, hindering the transition to renewable energy and undermining efforts to limit global temperature rise to 1.5°C above pre-industrial levels.
In Europe, regulators and the European Parliament are increasingly debating steps to hold banks—including central banks—to account for their climate-related risks, signaling potential binding restrictions on fossil fuel investments. This regulatory momentum, coupled with the financial and reputational incentives for central banks to reduce fossil fuel exposure, adds to the pressure on institutions like the SNB and the ECB to divest from fossil fuels.
The SNB's role as a central bank and its special role in Swiss financial markets means it refrains from investing in stocks of systemically important banks worldwide. The bank manages a balance sheet of several hundred billion Swiss francs, largely due to growing investor demand for the franc.
The news about the SNB's divestment from Chevron was first reported in the Swiss newspaper Neue Zürcher Zeitung. Despite the SNB's spokesperson declining to comment on individual stock-picking decisions, the bank's actions reflect a growing awareness of the need to address climate change and align financial policies with climate goals.
References:
[1] Reclaim Finance and Urgewald (2023). Central Banks' Fossil Fuel Exposure: A Growing Climate Risk.
[2] European Parliament (2023). Report on the role of the European Central Bank in climate change mitigation.
[3] International Energy Agency (2022). World Energy Investment 2022.
The Swiss National Bank (SNB) no longer invests in stocks or bonds of companies whose products or production processes significantly violate broadly accepted societal values, as seen in its decision to divest from Chevron. Central banks, including the SNB, are under increasing scrutiny for their role in financing fossil fuel projects, and there is growing pressure to divest from these projects to meet global climate targets like those in the Paris Agreement.
