Nordic Center for Sustainable Finance’s Post

BREAKING: The annual Banking on Climate Chaos report finds that since the Paris Agreement was signed in 2016, the world's 60 largest private banks provided US$6.9 trillion in financing to #fossilfuels. Nearly half – US$3.3 trillion – went towards fossil fuel expansion. In 2023 alone, banks financed US$705 billion in fossil fuel financing with US$347 billion going to fossil fuel expansion alone. The analysis finds that Canada’s major banks are increasingly the "lenders of last resort" for oil and gas expansion around the world, and are pulling Canada’s climate goals further out of reach. Of the US$6.9 trillion of global banks’ fossil fuel financing since 2016, Canadian banks have financed US$911.15 billion. Just five Canadian banks financed nearly US$103.85 billion to fossil fuels in 2023 alone, 13% of the value of the deals covered from global banks in this report for that year (US$705 billion). RBC remains Canada’s #2 fossil bank and #7 in the world in 2023, financing US$28.24 billion in 2023, and US$256.45 billion since the Paris agreement was signed in 2016. RBC is also one of the top bankers of 129 companies expanding methane gas (LNG) in 2023. Three Canadian banks make the 2023 Dirty Dozen list - RBC (#7), Scotiabank (#10), and TD Bank (#11). All five banks are in the top 16 globally. They hold an outsized proportion, relative to market cap, of global fossil fuel financing. Read the full report here: https://lnkd.in/gEvr_P4Q Read early media coverage of the report here: https://lnkd.in/eyBpG2Es #cdnpoli #banks #BOCC #DefundClimateChaos #BankingOnClimateChaos #StopTheMoneyPipeline #FossilBanksNoThanks #EndFossilFinance #climaterisk

Let's urge The World Bank President Ajay Banga to step up for our planet! While good progress has been made, we need more action on #climatefinance. Sign our petition to end #fossilfuel financing and promote a #cleanenergy transition: bit.ly/4aD0oMD

The power is in your hands to make a difference for the planet 🌍 European banks have poured €1.3 trillion of your money into fossil fuels since the #ParisAgreement was adopted 🏦 But you have the power to impact Europe’s #GreenTransition to clean energy. Find a clean bank now: https://bankforgoodeu.com/ #BankForGood

This should be much more of a scandal than it is #climatecrisis #globalwarming Banks have given almost $7tn to fossil fuel firms since Paris deal, report reveals https://lnkd.in/eqczVNwE

Last month, we published a report that analysed the climate targets of Europe’s 20 biggest banks. Today, we've written to the CEOs of all 20 of them. In our report, we found that the current targets of top European banks, such as Barclays and HSBC , are not fit for purpose if we are to to achieve net zero by 2050. Banks need to start setting sector-specific targets for sustainable finance that are grounded in science. This will allow them to show key stakeholders how they plan to shift financing away from fossil fuels, and toward critical sectors like renewable energy. This morning, we sent a letter to the CEOs of all 20 of these underperforming banks. ✉️ We've outlined how they can - and should - set more ambitious, transparent and coherent targets that will help them reach their net zero goals and meet commitments to protect people and the planet. Hear more from the Head of our Banking Programme Jeanne Martin 🎥⬇

We love 350 Aotearoa "Fossil Free Banks" resource, which makes it super easy for you to check if your savings are funding new fossil fuel projects (which is incompatible with all evidence towards a safe climate future). Have a look at the list below, and see how your bank is doing. If they're not with a fossil free bank, consider switching and letting your current bank know why you're moving away.

Why banks’ fossil fuel policies fail? Earlier this year, BNP Paribas made headlines by announcing its decision to stop underwriting bonds for oil and gas projects. This move is part of a broader trend among banks to align their operations with climate targets.  The logic goes that by cutting off finance, the development of new fossil fuel projects will be prevented, leading to a reduction in carbon emissions. But it is far from obvious that this logic holds. The question arises: If a bank withdraws $1 from fossil fuel bonds and loans, does this translate to $1 less in financing at the project level? The answer is likely no. Our new research indicates that the fossil fuel sector is remarkably resilient due to a phenomenon known as finance substitution, where the withdrawal of one bank is offset by the entry of another. The problem lies in the syndicated nature of fossil fuel deals. Most fossil fuel bonds and loans are underwritten by groups of partner banks, rather than by individual institutions. Syndication distributes the risk among participating banks, but it also creates a system where, if one bank, exits a deal, other syndicate members are incentivized to fill the funding gap with a new partner. For instance, in the years following the Paris agreement, several European banks, including UBS, DNB ASA, and Deutsche Bank reduced their average underwriting volumes by over 40%. Yet, this reduction did not translate to a decrease in overall funded projects. Lending volumes remained nearly constant, with $592 billion of underwritten deals in 2021, compared to an average of $584 billion from 2010 and 2016. The gap left by these European banks was quickly filled by others in Canada and Japan. Current regulatory measures, like climate risk-weighted capital requirements, are insufficient to tackle this challenge. While these may cap the absolute value of fossil fuel assets on a bank’s balance sheet, they do little to prevent banks with lower exposure from expanding their activities in the sector. BNP Paribas’ decision is a step in the right direction, but it is far from enough. The isolated actions of individual banks will have little effect without broader structural changes across the banking sector. The real challenge lies in establishing robust, globally coordinated regulations that effectively deter banks from exploiting loopholes and opportunistic behaviour, creating a level playing field for the low-carbon transition. Featured in the Banker Financial Times's FT Specialist division https://lnkd.in/dSX5fPv7 Full study here https://lnkd.in/dadbvBQQ Huge thanks to my co-authors, Max Falkenberg, Jamie Rickman, Sumit Kothari, Francesca Larosa, PhD, Michael Grubb ,and to Silvia Pavoni for hosting us!

For over half a decade, 350 Aotearoa has been tracking where our money goes and shone a light on our major banks that are lending and investing billions of dollars of our savings in coal, oil, and gas. By exposing the truth about our banks’ ties to the dirty fossil fuel industry, we were successful in pushing Kiwibank to go fossil free in 2020 - a win that could not have happened without people-power! On Thursday we released our 2024 Bank Statement Update to make it easier for you to assess each bank based on its investment in fossil fuels and climate commitments. Everyone in Aotearoa deserves to know if their bank is funding the climate crisis and choose to make their voice count by calling on their bank to go fossil-free. The big four Aussie-owned banks continue to invest in fossil fuels. They have the opportunity to make or break new fossil fuel projects - so it’s crucial we pressure them to divest from fossil fuels. You can find more details on our website - and what actions you can take to pressure these banks to go fossil-free. https://lnkd.in/gKN9dmMu Since 2016, the four Aussie-owned banks have loaned over $56 billion to the fossil fuel industry. This has enabled over 20 billion tonnes of emissions - more than 250 times the annual emissions of New Zealand! Right now, the coalition government’s war-on-nature fast-track consenting bill is threatening fossil fuel extraction in Aotearoa. The thing is - climate criminals can’t dig for fossil fuels without the finance to do so. This is why it is so crucial that we push our banks to go fossil-free. I loved working with Elliot Blyth and Adam Currie on this latest update and build on the incredible work from Erica Finnie, Claudia Palmer and Niamh O'Flynn ❤️

How Banks are Navigating the Low-#CarbonTransition: Are They Doing Enough? #Banks have the power to shape our low-carbon future, but are they making the most of it? A recent report reveals progress in the banking sector’s climate commitments—but it’s not enough. 🔑 Key Insights: #NetZero Commitments: 69% of banks have committed, but key areas like capital markets are left out. Sectoral Targets: 81% set targets for sectors like energy, yet high-emission industries (airlines, construction) are being ignored. #CarbonPerformance: Only 19% of banks are on track with climate goals for 2035. Just 3% align with the 1.5°C Paris target. What’s holding them back? 1. #Climategoals cover just 22% of their revenue. 2. Weak fossil fuel policies—none have committed to stopping new oil and gas financing. 3. Lack of transparency in high-emission financing. 4. Poor governance—few link executive pay to climate performance. 🌍 What Needs to Happen: 1. Expand the scope of climate commitments to cover all activities. 2. Increase transparency on emissions. 3. Strengthen targets for high-emission sectors. 4. Tighten fossil fuel financing policies. It’s time for the banking sector to address investors and consumers demand of responsible action. The future depends on it. #ClimateAction #Sustainability #NetZero #Banking #ESG #Investing all views personal.