Irresponsible investment? HSBC’s ESG communications crisis

For HSBC, a bank committed to “playing a leading role in mobilising the transition to a global net zero economy … by helping to shape and influence the global policy agenda”, sponsoring and addressing the FT Moral Money Summit, with its theme of “Turning Talk into Action to Hit ESG Targets”, must have seemed like the perfect profile-raising opportunity.

But far from burnishing its ESG credentials, HSBC is now reeling from a PR disaster involving the suspension of Stuart Kirk, the global head of responsible investment at its asset management division, following his controversial comments on climate change at last week’s event.

The fallout from Kirk’s speech and HSBC’s response have made headlines around the world – from the Financial Times to The Mirror, The Straits Times to The Wall Street Journal – and polarised opinion, prompting both outrage at his ‘offensive’ remarks and support for daring to tell the ‘truth’.

Kirk – a former FT journalist and editor of Lex – gave a presentation entitled “Why investors need not worry about climate risk”, which accused policymakers and central bankers of overstating the financial risks of climate change and included a slide saying “Unsubstantiated, shrill, partisan, self-serving, apocalyptic warnings are ALWAYS wrong”.

Attacking climate “nut jobs”, he complained about having to spend time “looking at something that’s going to happen in 20 or 30 years”, and joked about the risk of flooding, saying, “Who cares if Miami is six metres underwater in 100 years? Amsterdam has been six metres underwater for ages and that’s a really nice place.”

Following an outcry over his remarks from climate change activists, HSBC’s chief executive and its head of wealth and personal banking both denounced Kirk’s remarks via social media posts.

Yet according to the FT, which first reported Kirk’s suspension, the theme and content of his speech had been agreed internally within HSBC a couple of months earlier.  

The bank’s PR team has, unsurprisingly, been firefighting ever since the event but declined to comment on Kirk’s suspension when contacted by media.

Kirk’s remarks were always likely to be controversial and provocative, given his views on climate change risk and his outspoken nature, of which HSBC’s management and PR team were presumably aware. So why did HSBC sanction his speech, yet fail to predict and prepare for the inevitable backlash, only to perform a spectacular U-turn after the event and ‘cancel’ him pending an internal investigation? Moreover, in light of his uncompromising and combative stance on climate change, what does Kirk’s position as global head of responsible investment say about HSBC’s commitment to a net zero future? Is the bank simply playing lip service in its climate strategy pledge?

Businesses should either accept that they are broad churches with individuals holding different views with full entitlement to express them (as long as this is done respectfully), and be prepared to deal with the potential fallout – or they should make clear that there is only ever one corporate line that can be expressed publicly, and ensure consistency in actions as well as words. This principle extends way beyond the ESG sphere – and it is the basis from which all communications advice should flow.

The PR debacle comes just weeks after HSBC faced accusations of greenwashing by the UK’s advertising regulator. A leaked draft report by the Advertising Standards Authority ruled that two HSBC adverts misled customers by selectively promoting green initiatives while failing to disclose information about the bank’s financing of companies with substantial greenhouse gas emissions.  

And last year, HSBC came under fire from shareholders for failing to take climate change seriously, with some of Europe’s leading investors filing a climate resolution that called on the bank to publish a strategy and targets to reduce its exposure to fossil fuel assets.

One thing is certain: if HSBC wants to fulfil its “ambition … to be the leading bank supporting the global economy in the transition to net zero,” as CEO Noel Quinn posted on LinkedIn over the weekend, it has a long way to go.    

Written by Sarah Peters

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ONTIER: High Court Defamation Trial Starts Monday

ONTIER LLP client, Dr Craig Wright, is suing podcaster Peter McCormack over the content of 14 tweets that the defendant published between March and August 2019, and one YouTube interview livestreamed in October 2019, in which McCormack accused Dr Wright of fraudulently claiming to be Satoshi Nakamoto, the pseudonymous inventor of Bitcoin. This two-day defamation trial is set to determine the single issue of serious harm.

Dr Wright claims his reputation was seriously harmed by McCormack’s repeated disparagement of Dr Wright online and, in particular, by his decrying as fraudulent Dr Wright’s legitimate claim to be the inventor of Bitcoin, the world’s first functioning and successful electronic cash system.

Amongst other things, the court will hear that McCormack’s tweets reached a global audience of millions, with many hundreds of thousands of those publishees likely being in England & Wales (to which Dr Wright’s claim for serious harm is limited).

Some 18 months ago, McCormack abandoned his positive defences of truth, public interest and abuse of process and, following a hearing last year, was denied permission to resurrect parts of those submissions by inserting them into the sole surviving limb of his defence, in which he denies that his publications caused serious harm to Dr Wright’s reputation.

Simon Cohen of ONTIER LLP says:

“This long-running dispute has endured various attempts by Mr McCormack to change course but we are now set to demonstrate to the court the extent of harm caused to Dr Wright by the defendant’s actions. Social media provides no hiding place for libellous comment. In fact its use often exacerbates the harm, given its capacity for the swift and exponential spread of damaging untruths.”

Notes to Editors

This defamation trial is the latest in a series of legal claims issued by ONTIER LLP, on behalf of Dr Wright and his associated entities, to uphold his right to protect his lawfully-held digital assets, his reputation as the creator of Bitcoin and his associated intellectual property:

  • In 2021 ONTIER successfully brought a copyright claim against the anonymous digital currency enthusiast operating under the pseudonym “Cøbra”.
  • ONTIER has recently defeated a strike-out attempt by digital currency enthusiast, Magnus Granath, following Dr Wright’s defamation action, the trial of which will heard by the High Court in late 2023.
  • Last year ONTIER also launched a landmark claim against the developers of BTC, BCH, BCH ABC and BSV to restore control to addresses containing Bitcoin and other digital assets. The defendants’ jurisdictional challenge to this claim is currently being appealed by the claimant, Tulip Trading Ltd (the trust beneficially-owned by Dr Wright and his family).
  • ONTIER is advising companies owned by Dr Wright in their passing off claims against exchanges Kraken and Coinbase, filed in the High Court earlier this month.
  • Dr Wright is also advised by ONTIER on his defence and counter-claim to the Crypto Open Patent Alliance’s (COPA) challenge to Dr Wright’s authorship of the White Paper, which also will likely be heard in 2023.

(23rd May 2022)

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ONTIER: Bitcoin Creator Launches IP Claims Against Digital Currency Exchanges

ONTIER LLP client, Dr Craig Wright, the inventor of the first successful electronic cash system, Bitcoin, together with two companies associated with him, Wright International Investments Limited (WII) and Wright International Investments UK Limited (WIIUK), have filed intellectual property claims against two currency exchanges – Kraken and Coinbase (NASDAQ: COIN) – for misrepresenting that the digital asset “Bitcoin Core” (BTC) is Bitcoin.

The Claimants assert that these exchanges, and others, have been trading – and encouraging investors and consumers to trade and invest – in BTC, by passing off that asset as Bitcoin, despite it only having been created in 2017 as a software implementation which is different from and separate to the Bitcoin protocol which Dr Wright fixed when he first created the electronic cash system more than 13 years ago. The only digital asset that remains true to the original Bitcoin protocol is “Bitcoin Satoshi Vision” (BSV) which is the software implementation of the original Bitcoin protocol. The Claimants contend that this misrepresentation by Coinbase and Kraken has led to confusion among digital currency asset holders as to the authenticity of the assets many have purchased and traded in.

The Claimants seek an injunction restraining the defendants from promoting BTC as Bitcoin, through improper use of the Bitcoin sign or any visually similar sign or wording.

The claims are likely to be worth several hundred billions of pounds when an inquiry into the full account of profits of each of these exchanges is undertaken by expert witnesses to the Court.

The proceedings were filed on 29 April 2022 in the Intellectual Property List of the Business and Property Courts of England and Wales. They are the first in what will be a series of claims against each of the largest digital currency exchanges, designed to prevent future misperceptions as to the true operational nature of Bitcoin.

Bitcoin (BSV) is the fastest, most scalable environmentally efficient and regulation-friendly public

ledger that exists whilst remaining fixed to Dr Wright’s original protocol. Dr Wright is concerned for no other digital asset to improperly cloak itself under the Bitcoin moniker.

Simon Cohen of ONTIER said:

“These actions are undoubtedly game-changing for the digital asset market. Simply put, the Claimants’ assertion is if your digital asset doesn’t strictly adhere to the Bitcoin protocol and is linked to the Bitcoin blockchain it is not Bitcoin, and should not be marketed or referenced as such. Product choice is a vital driver of innovation – but asset-holders must be aware of exactly what they are buying and stability comes from transparency. Bitcoin was always designed to be a peer-to-peer electronic cash payment system, not a store of value. While this is quite likely the highest value claim to have ever come before the English courts, in fact the arguments in support of our clients’ position are straightforward and verifiable.”

Dr Wright, WII and WIIUK are advised by ONTIER LLP Partners, Derek Stinson and Aoife Keane,Managing Associate, Simon Cohen and Associate, Tom Leach. Alastair Wilson QC, Michael Hicks and Jamie Muir Woof of Hogarth Chambers are instructed as Counsel, with additional assistance from Harcus Parker Partner, Damon Parker.

ENDS

Notes to Editors:

Dr Wright wrote the White Paper “Bitcoin: A Peer-to-Peer Electronic Cash System” and published it in October 2008 under the pseudonym, Satoshi Nakamoto. He was involuntarily outed as Satoshi by Wired magazine in December 2015.

The claimants recognise the regulatory responsibilities held by those exchanges that are listed on

NASDAQ in respect of these proceedings.

This litigation is the latest in a series of legal claims issued by ONTIER LLP on behalf of Dr Wright and his associated entities to uphold his right to protect his lawfully-held digital assets, his reputation as the creator of Bitcoin and his associated intellectual property:

  • In 2021 ONTIER successfully brought a copyright claim against the anonymous digital currency enthusiast operating under the pseudonym “CØbra”).
  • Last year ONTIER also launched a landmark claim against the developers of BTC, BCH, BCH ABC and BSV to restore control to addresses containing Bitcoin and other digital assets. The defendants’ jurisdictional challenge to this claim is currently being appealed by the claimant, Tulip Trading Ltd (the trust beneficially owned by Dr Wright and his family).
  • 23/24 May 2022 sees the London High Court trial of Dr Wright’s defamation claim against bitcoin commentator Peter McCormack.
  • Similarly, ONTIER is instructed by Dr Wright in his English defamation action against digital currency enthusiast, Magnus Granath, the trial of which is likely to be heard in late 2023.
  • ONTIER is also advising Dr Wright on his defence and counter-claim in respect of the Crypto Open Patent Alliance’s challenge to Dr Wright’s authorship of the White Paper which will likely be heard in 2023.

The firm is increasingly recognised for its high-profile and market leading Bitcoin related and cybercrime litigation and has an established and growing practice for recovering lost, stolen and hacked Bitcoin. The firm acted in successful English High Court proceedings against Reliantco Investments Ltd, a digital asset and securities exchange which blocked and seized a substantial amount from a client’s trading account. ONTIER LLP was able to recover the client’s full investment, its unrealised gains and loss of profit (that the client would have earned from intended investments had its funds not been unlawfully withheld).

ONTIER is recognised in the UK Legal 500 for commercial litigation, international arbitration and civil fraud. The firm has offices in 18 cities in 13 countries, giving a truly international capability.

(3 May 2022)

We are recognised leaders in our field. We are proud to uphold the ethical and educational standards for the PR industry as members of the CIPR and PRCA.

Bell Yard Melanie Riley Bell Yard Melanie Riley