This interview is the latest instalment in the Trinity Impact Series, featuring discussions with leaders who are shaping the future of business. Conducted by Jonathan Totterdell, Head of Communications with the Trinity Business Alumni, this conversation delves into the evolving landscape of sustainable finance and corporate climate leadership.
Our guest, Alan Duffy, is one of the foremost figures in European sustainable finance. As Managing Director and Head of Sustainable Finance for HSBC Commercial Banking in Europe, he is responsible for driving the bank’s efforts to help businesses transition to net zero. Previously, he served as CEO & Head of Banking of HSBC Ireland for nearly eight years, playing a key role in expanding the bank’s corporate banking operations and embedding sustainability into its strategic priorities.
In addition to his work at HSBC, Alan is a co-founder of Chapter Zero Ireland, an initiative that helps to equip non-executive directors with the tools to lead crucial boardroom discussions on climate change and its impact of business.
A graduate of Trinity College Dublin, Alan holds a Bachelor of Business Studies (BBS), MBA from Smurfit School, is a Chartered Director as well as further qualifications in sustainable finance from Imperial College London and Cambridge University. He also served as President of the Trinity Business Alumni, reflecting his strong connection to the university and its business community.
In this conversation, we explore Alan’s journey in sustainable finance, the challenges and opportunities for corporate climate leadership, and the role of non-executive directors in shaping a sustainable future.
The State of Sustainable Finance in Europe
Can you tell us your thoughts on the development of sustainable finance in Europe at the moment?
Europe is the gravitational centre for global sustainable finance, both in terms of setting policy and overall market activities. Issuances in the international and very liquid green bond market are mainly in Euros and the Sustainable linked loan market ( SLL) has its origin in Europe. Governance around what constitutes and can be marketed as sustainable activities is very sophisticated in Europe and tools such as the EU Taxonomy have spread globally. A rapidly increasing number of our European clients are establishing Science-Based Targets (SBTs) to anchor their transition journeys and embed ESG in their operations. With recent geopolitical changes a lot of focus is now on transition and adaptation finance.
Founding Chapter Zero in Ireland
What inspired you to start Chapter Zero in Ireland several years ago, and what gap did you see in corporate boardrooms when it comes to climate leadership?
I was inspired by the work done by our Group Chairman, Mark Tucker, actively engaging with Chapter Zero in Hong Kong, New York, and London. Corporate boardrooms are ground zero in the transition to a carbon-neutral economy, catalysing change by setting ambition, strategy, and positioning firms to navigate risks and seize opportunities.
To make the right calls, boards need to be well-informed in a complex and ever-changing landscape. Providing education and thought leadership directly to board members through Chapter Zero offered the best impact in driving real change.
Climate Leadership for Non-Executive Directors
How do non-executive directors, who may not have a climate background, begin to explore sustainability as a strategic business imperative, not just a compliance issue?
Fundamentally, it’s about understanding that carbon reduction and the net zero transition will be non-linear, disorderly, and disruptive. Building a resilient and future-proof business is at the core of sustainability, and non-executive directors play a crucial role in driving this change.
Asking the right questions is key: Are we using the right technology? What are our competitors doing? How quickly is our industry changing? What are our customers demanding? What regulatory changes are coming, and how can we go beyond compliance to capitalise on them? For industries like steel, automotive, and energy, getting the answer right will dictate future success both for the planet and for shareholders.
Challenges in Embedding Climate Action in Corporate Decision-Making
What are the biggest challenges boards face in embedding climate action into corporate decision-making, and how can they overcome them?
The biggest challenge is navigating change in an uncertain environment. We live in an era of heightened geopolitical instability, policy shifts, and regulatory uncertainty. I am seeing sustainability slip down board agendas in the face of these external pressures.
For many companies, transitioning to net zero requires material investment decisions. Having a long-term vision and confidence in the chosen pathway isn’t always easy. It may be tempting to delay investment decisions, but the world moves fast. Not looking ahead can have dire consequences – just think of Kodak in the late ’90s and early 2000s!
The Impact of Chapter Zero
Can you share a success story where Chapter Zero’s work directly influenced a company’s climate strategy or boardroom decisions?
Our members come from a diverse range of companies, and their levels of technical awareness vary considerably. Last year, we ran a detailed workshop on Scope 3 emissions, and the feedback was overwhelmingly positive. Some non-executive directors commented that it was the first time they had learned about the 15 distinct reporting categories defined by the GHG Protocol.
This awareness has led to a sharper focus on emissions reduction within the value chains of Irish corporates and encouraged practical steps for collaboration with other actors to reduce emissions.
The Evolving Role of Non-Executive Directors
Looking ahead, how do you see the role of non-executive directors evolving in the mission against climate change, and what’s next for Chapter Zero?
NEDs have a crucial role to play, particularly as the net zero transition faces geopolitical headwinds. They must ensure sustainability remains a core board agenda item and set a positive tone from the top.
They also need to look beyond short-term challenges and help their boards focus on the long-term structural changes we are experiencing. Striking the right balance across various fiduciary responsibilities is essential.
Government Engagement and Policy Influence
Have you seen a shift in how governments and policymakers engage with boards on climate issues? If so, how can boards leverage this to drive meaningful action?
I think governments and policymakers are more open to exchanging views with boards on climate issues, perhaps more so than on other topics. There is a collective recognition that we are all learning together as this transition evolves.
New technologies, such as AI, have the potential to expedite the transition if used effectively, but they also come with huge energy requirements. Boards should leverage this openness to ensure their voices are heard and shape policies accordingly.
Skills and Mindsets for Climate Leadership
What skills and mindsets do today’s non-executive directors need to effectively lead on climate, and how does Chapter Zero help bridge any knowledge gaps?
Key skills and mindsets for NEDs in today’s world include:
- Technical Competence – A solid grasp of the science and technologies driving the transition. While a granular understanding isn’t necessary, intellectual curiosity is key.
- Strategic Mindset – The ability to integrate climate considerations into business strategy and understand double materiality.
- Stakeholder Management – Navigating diverse and evolving views, competing priorities, and ensuring investors, regulators, and customers all buy into the longer-term vision.
Chapter Zero helps bridge this gap by fostering a community of shared knowledge, leveraging external networks, and continually upskilling board members with thought leadership.
Looking Ahead
What’s next for Chapter Zero and the broader movement towards sustainable finance?
The transition to net zero will continue to reshape corporate landscapes. With the right education and strategic approach, non-executive directors can drive meaningful climate action, ensuring their companies remain resilient and forward-thinking in an increasingly complex world.
