Wall Street’s largest banks simultaneously exited the same climate coalition that Republican lawmakers investigated last year, which was announced just weeks before President-elect Donald Trump was sworn in.
Since 2021, the banking giants have been prominent members of the Net-Zero Banking Alliance (NZBA), a global group of financial institutions “committed to financing ambitious climate action” to move the economy to net-zero greenhouse gas emissions by 2050.
However, since December, six of the world’s largest banks, JP Morgan, Wells Fargo, Goldman Sachs, Morgan Stanley, Citigroup and Bank of America, have separately announced their exit from the alliance, encouraging member banks to “ Design and set” additionally. Achieving “science-based, zero-sum goals.”
The banks said they remain committed to emissions reduction targets, but will do so independently.
A potential second withdrawal from the Paris Climate Treaty may look different from the first US exit
JPMorgan Chase & Co sign and building exterior in New York City. (Plexy Pictures)
A spokesman for JPMorgan, the latest bank to withdraw, said: “We will continue to act independently to advance the interests of our company, our shareholders and our clients and will continue to focus on practical solutions to help advance low-carbon technologies while enhancing energy security.” The coalition said in a statement.
BlackRock, the world’s largest investment firm, also announced on Thursday that it was separating from a major climate group, the Net Zero Asset Managers Initiative, which works with asset managers to reach net-zero emissions by 2050 or earlier.
The coincidence of exits comes just weeks before Trump takes office, who is expected to break with President Biden’s goal to cut greenhouse gas emissions and possibly withdraw from the Paris climate agreement.
A Wall Street sign in front of the New York Stock Exchange in New York City on Wednesday, July 31, 2024. (Michael Nagel)
“The surprise exit of these major US banks from the NZBA is a lily-shaming effort to deflect criticism from Trump and his fellow climate deniers,” said Paddy McAuley, a senior analyst at Reclaim Finance.
“A few years ago, when climate change was high on the political agenda, banks were keen to flaunt their commitments to climate action,” Macauley added. “Now that the political pendulum has swung the other way, suddenly acting on climate doesn’t seem so important to Wall Street lenders.”
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These exits come almost a year after a group of Republicans in the House of Representatives launched an investigation into the six banks regarding their participation in the international coalition due to allegations that it may affect the agricultural sector.