Mega-Banks love Climatic Change

Just Three Of World’s Top Ten Banks Signed UN Climate-Goals Commitment

by Tyler Durden
Mon, 09/23/2019

Just three of the world’s 10 biggest banks agreed to join a coalition of 130 global financial firms which have agreed to reshape their business to align with international efforts to address climate change and other environmental issues according to Bloomberg.

Citigroup, Mitsubishi UFJ Financial Group and Industrial and Commercial Bank of China joined the United Nations’ Principles for Responsible Banking pledge, which now represents $47 trillion in assets – or 1/3 of the global banking industry according to UN Secretary-General Antonio Guterres during a Sunday launch event.

Other signers include “European banks BNP Paribas SA, Barclays Plc and UBS Group AG,” which have agreed to map out and publish plans by 2023 governing their targets for sustainability.

Guterres implored banks to increase financing for green-growth businesses, and to “Invest in climate action and divest from fossil fuels and pollution in general.” 

There’s a wide range of stronger actions that banks could take, for example, banning thermal coal financing or setting a time line to phase out funding of the fossil-fuel industry. One of the signers, ING Groep NV, said last week it would boost lending to automakers producing more electric vehicles than those that produce vehicles with internal combustible engines.

The principles follow another set of voluntary standards for the asset-management industry– the Principles for Responsible Investment — that were adopted by money managers 13 years ago to encourage firms to incorporate environmental, social and governance factors into their investments. The industry has since grown to more than $30 trillion. –Bloomberg

Several of the banks which declined to sign the agreement – such as Goldman Sachs, say they have their own sustainability programs, while others are still reviewing the pledge.

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According to Goldman, they already have several target-related efforts similar to the PRB and will continue to engage with the UN’s initiative as it continues to develop.

Wells Fargo pointed to their 2016 goal to address social, economic and environmental challenges over five-years.

JP Morgan, Morgan Stanley and Bank of America declined to comment.

UN Assistant Secretary General Satya Tripathi said the reluctance of some banks to commit is a signal the principles have teeth. Some are not ready to be held to account for their lending,” he said during a Sept. 19 panel discussion.

The PRB was launched at the start of the UN’s Climate Action Summit in New York. Transitioning to low-carbon and climate-resilient economies that are aligned with the Paris Agreement requires additional investment of at least $60 trillion from now until 2050, Christiana Figueres, executive secretary of the UN’s Framework Convention on Climate Change, said in a statement.

The PRB “offers a ladder to climb for every bank, though some banks start very low and have a particularly big ladder to climb,” said Peter Blom, chief executive officer at Triodos Bank, a Dutch lender that finances renewable energy and organic agriculture, and a signatory to the agreement. –Bloomberg

“It’s no longer enough to buy a few green bonds or make a few renewables investments and say that you are green,” said Eric Usher, head of the finance initiative at UNEP, which led the organization of the principles for the last two years. “The progress going forward will be about a fuller scale institutional realignment for sustainable development — scaling up the green, but also turning down the brown.”

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Published at https://www.zerohedge.com/health/just-three-worlds-top-banks-signed-global-climate-goals-commitment