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43 banks from 23 countries on all continents have joined Mark Carney's Net Zero Banking Alliance, under the UNFCCC's "Race to Net Zero" campaign
A thread on the good, the bad, and the ugly of the alliance & the Net-Zero guidelines it published today
https://www.unepfi.org/net-zero-banking/
A thread on the good, the bad, and the ugly of the alliance & the Net-Zero guidelines it published today
https://www.unepfi.org/net-zero-banking/
Let's start with what's nowhere to be found within the Guidelines - despite being *pretty crucial* to any bank's climate strategy:
* Coal and fossil fuel phase out plans
* Biodiversity loss and deforestation
* Just Transition (although the SDGs are briefly mentioned)
* Coal and fossil fuel phase out plans
* Biodiversity loss and deforestation
* Just Transition (although the SDGs are briefly mentioned)
Not requiring robust coal phase out plans is a missed opportunity in light of:
* The UK gvt's coal agenda ( @PastCoal)
* Investors' expectations for the banking sector
https://www.iigcc.org/resource/investor-expectations-for-the-banking-sector/ https://shareaction.org/shareholder-campaign-secures-hsbc-coal-phase-out/
* Leading banks' coal policies (it's possible to do it guys!)
* The UK gvt's coal agenda ( @PastCoal)
* Investors' expectations for the banking sector
https://www.iigcc.org/resource/investor-expectations-for-the-banking-sector/ https://shareaction.org/shareholder-campaign-secures-hsbc-coal-phase-out/
* Leading banks' coal policies (it's possible to do it guys!)
* Citizens and customers' expectations
https://bit.ly/3tEJ7gO
And of course the fact that coal and fossil fuels in general are a leading source of GHGs & that our planet is literally burning
https://bit.ly/3tEJ7gO
And of course the fact that coal and fossil fuels in general are a leading source of GHGs & that our planet is literally burning
What's good about the NZBA then?
* Banks "shall" disclose their financed emissions on an annual basis
* Banks are mandated to use scenarios that "shall be" no-overshoot or low-overshoot (e.g. IPCC P1 & P2 scenarios) & have conservative assumptions on NETs
* Banks "shall" disclose their financed emissions on an annual basis
* Banks are mandated to use scenarios that "shall be" no-overshoot or low-overshoot (e.g. IPCC P1 & P2 scenarios) & have conservative assumptions on NETs
They "shall" also have "reasonable assumptions" on carbon sequestration achieved through nature-based solutions & land use change
This will be subject to interpretation but is nevertheless an important recognition of the massive risk of relying on NETs
https://bit.ly/3sDE0w2
This will be subject to interpretation but is nevertheless an important recognition of the massive risk of relying on NETs
https://bit.ly/3sDE0w2
Banks are mandated to set 2030 & 2050 targets for the emissions embedded in their financing
However
* The targets don't need to be aligned w 1.5C (the guidelines refer to "well-below 2C & striving for 1.5C")
* Only members of the #UNPRB have to get their targets verified
However* The targets don't need to be aligned w 1.5C (the guidelines refer to "well-below 2C & striving for 1.5C")
* Only members of the #UNPRB have to get their targets verified
* The targets do *NOT* need to cover off-balance sheet activities such as underwriting
This. is. madness.
Major banks provide as much fossil fuel financing through underwriting as they do through lending.
This. is. madness.
Major banks provide as much fossil fuel financing through underwriting as they do through lending.
* Banks have a total of 4 years to set targets & publish plans to back these up
I understand it is not easy. That methodologies don't always exist, data is missing, and things still need to be figured out. But *four* years!?
Many European banks have ***already*** set targets
I understand it is not easy. That methodologies don't always exist, data is missing, and things still need to be figured out. But *four* years!?
Many European banks have ***already*** set targets
* Offsets are thought to have a role to play but preferably where "there are limited technological or financial alternatives to eliminate emissions"
This will be subject to interpretation w/o clear guidelines
They also do not *need* to be additional & certified
This will be subject to interpretation w/o clear guidelinesThey also do not *need* to be additional & certified
Many are likely to disagree - and I do speak from a European perspective - but I fear that the Net-Zero Banking Alliance is a missed opportunity to define climate leadership for the banking sector
As @PositiveMoneyUK told the FT this morning...
As @PositiveMoneyUK told the FT this morning...
“More voluntary alliances filled w repeat greenwashing offenders is not enough”
“We need urgent action from regulators (..) to ensure that the entire financial system is aligned with the legally binding environmental targets gvts have committed to”
https://www.ft.com/content/77a8292d-2e7f-43a1-9062-2e639c1e6b2a /END
“We need urgent action from regulators (..) to ensure that the entire financial system is aligned with the legally binding environmental targets gvts have committed to”
https://www.ft.com/content/77a8292d-2e7f-43a1-9062-2e639c1e6b2a /END
