Banks can pledge to be better managers on the planet by reducing emissions and other actions, but their money keeps pumping oil for now.
Some 60 of the world’s largest commercial and investment banks have invested $ 3.8 trillion in fossil fuels from 2016 to 2020, five years after the signing of the Paris Voluntary Agreement. The goal of the multinational pact is to limit global warming to well below 2 degrees Celsius and preferably to 1.5 degrees, compared to pre-industrial levels. Beyond oil patch financing, global coal projects also continue to be funded.
According to a report called Banking on Climate Chaos 2021 released on Wednesday by a handful of climate organizations, including the Rainforest Action Network. The group’s financial sector review has been published annually for more than a decade.
According to the report, the three banks that financed more fossil fuel in 2020 were JPMorgan Chase JPM,
to $ 51.3 billion; Citi C,
to $ 48.4 billion; and Bank of America BAC,
with $ 42.1 billion. According to the report, JPMorgan’s fossil fuel funding since the Paris declaration has reached $ 317 billion. WFC funding from Wells Fargo & Co. in the fossil fuel space it fell 42%, to $ 26.4 billion in 2020.
Read: Goldman Sachs Insists on Disclosing Whether Its Oil Financing Works Against Net Zero Emissions Target
French bank BNP Paribas BNP,
It was shown to increase its loans to oil, gas and similar interest by 41% in 2020 over the previous year. Its customers have included BP BP,
Total DEAD,
and Royal Dutch Shell RDS.A,
who have pledged to reduce their dependence on fossil fuels and to invest more in companies related to renewable energy.
Annually, total fossil fuel funding among the banks in the report fell by 9% in 2020, although this is largely due to the closure of COVID-19.
Read: Global investors with $ 54 trillion tell companies to commit to zero emissions to showcase their work
“This report serves as a reality check for banks that think vague‘ zero-zero ’targets are enough to stop the climate crisis,” said Lorne Stockman, senior research analyst at Oil Change International. “Our future is where money flows and by 2020 these banks have plowed billions to lock us into a new climate chaos.”
Bank of America earlier this year joined other major banks, including JPMorgan Chase and Morgan Stanley MS,
who has pledged to achieve zero net greenhouse gas emissions through funding before 2050. Bank of America, as part of a group working to align accounting information on carbon, said then that undertakes to disclose its funded emissions by 2023 at the latest.
Val Smith, Citi’s sustainability manager, said in a blog post this week that the lender will work with existing fossil fuel banking customers to move first to a public report on greenhouse gas emissions and finally , to a phasing out of funding offered to companies that do not meet carbon reduction standards.
Banks continue to advise other companies on the transition to dependence on fossil fuels. The economic impact of climate change could reach $ 69 trillion this century and investment in the energy transition is expected to increase to $ 4 trillion a year, according to Haim Israel, head of a report in the earlier this year, the world head of thematic research at Bank of America.
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