In an update of its ESG policies and net-zero targets, the life and pensions group said that going forward it will sell its stakes in any business that derives more than 30% of its income from coal.
Equities will be fully divested by the end of 2021, while fixed income assets will be gone by the end of 2022.
The Pru added that it wants to reduce carbon emissions of all assets in policies and its portfolio by 2025 and it will start to engage with companies in its portfolio responsible for 65% of emissions.
A resolution put forward at its AGM by climate change activist group Market Forces calling on the bank to change its policies received 14.4% in favour, which is respectable in the context of normal voting patterns.
Chairman Nigel Higgins added that the bank aims to come back next year with a Say on Climate advisory vote on its approach and progress including additional targets and sectors, and updated policies for important parts of the fossil fuel landscape.
“We are aware that there is a range of views on the approach to Say on Climate advisory votes, so we will develop our approach on the back of proactive consultation with shareholders and other stakeholders later on this year.
“We know that not everybody believes we are committed to delivering on this, so we need to make sure that our commitments, policies, and our reporting data are sufficiently robust to refute that doubt.”
At Prudential, chief executive Mike Wells said: “Any future climate crisis will disproportionately affect the communities we serve in Asia and Africa.
“Today’s announcements set out how Prudential intends to play the fullest possible role in the transition to the net-zero future which is essential if global temperature rises are to be controlled.”