Climate groups: Mark Carney’s GFANZ $130 Trillion in Net Zero Commitments ignores fossil fuel financing

Climate groups have recently pushed back on GFANZ for loopholes in net zero framework

GLASGOW — Today the Glasgow Financial Alliance for Net Zero (GFANZ) announced in its progress report that $130 trillion under 450 firms has been committed to net zero targets over the next three decades. According to their release,

29 asset owners that have committed to reducing portfolio emissions by 25-30% by 2025;
43 asset managers have published targets for 2030 or sooner;
and Net Zero Banking Alliance members have published “the first targets”

All “Big Six” Canadian banks and six most prominent US banks have joined the Net Zero Banking Alliance (NZBA) under the GFANZ. According to new analysis by Stop the Money Pipeline member Rainforest Action Network:

39 NZBA signatory banks provided $575 billion to the fossil fuel industry in 2020, including $40 billion to top client Exxon
NZBA signatory banks include the 13 top fossil fuel funding banks in the world since Paris, and 21 of the top 23. Altogether, the 39 NZBA signatories that are among the world’s 60 largest banks account for US $3.1 trillion in fossil fuel financing from 2016-2020, 82% of total financing.

Member organizations of the Stop the Money Pipeline coalition released the following statements in reaction to the news:

Lucie Pinson, Executive Director of Reclaim Finance, said: “More than $130 trillion in AUM and not a single rule to prevent even one dollar from being invested in the expansion of the fossil fuel sector. Once again, the financial sector is willing to puff itself up with hot air commitments instead of enacting the concrete cuts in oil, gas and coal financing we really need. It’s worth asking if the GFANZ and its members are actually ready to lead the charge against climate change, given that they are actually slowing down the green energy revolution by keeping afloat the polluting fossil fuel industry.”

“This announcement yet again ignores the biggest elephant in the room. Fossil fuel companies. There is no mention of the F words at all in this new declaration from the Net Zero clubs. We can not keep under 1.5 degrees if financial institutions don’t stop funding coal, oil and gas companies particularly those actively applying for and building new fossil fuel infrastructure like coal mines, tar sands pipelines and deep sea drilling. These commitments by private finance, including the world’s largest fossil fuel financiers, seem more like smoke and mirrors than real climate action,” said Richard Brooks, Climate Finance Director, STAND.earth

“In 2020, 39 NZBA banks provided a total of $575 billion in lending and underwriting to the fossil fuel industry – with $40 billion to notorious climate villain Exxon, whose plans for massive expansion of oil and gas extraction mean huge increases in emissions when we have to cut carbon in half in the next decade. There’s now consensus that net zero and alignment with 1.5°C means an immediate end to an expansion of the fossil fuel sector. Today’s progress report ignores the choice that NZBA signatories face: either they stop financing fossil expansion, or their net-zero commitments are greenwash. The credibility of GFANZ is at stake,” said Jason Opeña Disterhoft, Senior Climate and Energy Campaigner at Rainforest Action Network.

“It’s significant that such a large share of the financial sector has recognized its role in driving the climate crisis and the need to wind down its financed emissions,” said Sierra Club Fossil-Free Finance Campaign Manager Ben Cushing. “But achieving net-zero by 2050 and staying within 1.5°C of warming means stopping financing for fossil fuel expansion today. That’s the key test for whether these commitments are aligned with reality or just an attempt at good PR.”

Peter Bosshard, Global Coordinator of Insure Our Future says, “The commitments which GFANZ has published today are a mile wide and half an inch deep. Most importantly, neither the Net-Zero Insurance Alliance nor any of the other alliances represented by GFANZ require their members to stop insuring, investing in or otherwise supporting the continued expansion of the fossil fuel industry. Rather than chasing a high volume of symbolic commitments, the NZIA and other alliances should deliver tangible new actions to phase out the production and consumption of fossil fuels now.”

“Finance institution members of GFANZ that pretend to support net zero, and yet still fund fossil fuel expansion, are trying to pull the wool over everybody’s eyes. While trying to grab nice headlines for themselves today they are passing on the climate disaster to future generations. We won’t stand for it,” said Doug Norlen, Director, Economic Policy Program, Friends of the Earth US.