Just a few days after President Joe Biden\u00a0took\u00a0a victory lap for \u201caction to get more oil\u201d undertaken by his administration, a cabal of climate change groups complained that U.S. financial institutions continue to fund the fossil fuel industry.
\nReclaim Finance, a French climate pressure group, published a\u00a0report\u00a0on Tuesday, during the\u00a0second\u00a0day of the World Economic Forum, that analyzed\u00a0the support that the\u00a0world\u2019s largest fossil fuel developers have received from\u00a0financial institutions in the\u00a0\u201cnet zero\u201d alliance.
\nExecutive Director and founder of Reclaim Finance Lucie Pinson decried that \u201cthe science is very clear,\u201d adding:
\nWe need to stop developing new coal, oil and gas projects as soon as possible if we want to meet our climate goals and avoid a worst-case scenario.\u00a0Yet, it is business as usual for most banks and investors who continue to support fossil fuel developers without any restrictions, despite their high-profile commitments to carbon neutrality. Their greenwashing is all the more damaging as it casts doubt on the sincerity of all net zero commitments and undermines the efforts of those who are truly acting for the climate.
\nThe report claimed that\u00a0Citigroup, the most international of America\u2019s megabanks and founding member of the\u00a0Glasgow Financial Alliance for Net Zero, and\u00a0BlackRock, the world\u2019s largest asset manager, contributed more support to the\u00a0expansion of the fossil-fuel industry than any other banking and investment company within the alliance. The analysis showed that\u00a0Citigroup had \u201capproved 136 transactions that directly provided and facilitated US$30 billion in capital to fossil fuel developers,\u201d and BlackRock \u201chas holdings of US$191 billion in 173 different fossil fuel developers, with 89% by value in oil and gas.\u201d
\nAs summarized by Reclaim Finance, the analysis found:
\n\uf0b7Since joining the alliance, 56 of the biggest banks in the Net-Zero Banking Alliance (NZBA) have provided US$270 billion to 102 major fossil fuel expanders, via 134 loans and 215 underwriting transactions;
\n\uf0b758 of the largest members of the Net Zero Asset Managers initiative (NZAM) held at least US$847 billion of stocks and bonds in 201 major fossil fuel developers as of September 2022;
\n\uf0b7Only a handful of the financial institutions have adopted policies that meaningfully restrict finance to new fossil fuel projects and companies developing new fossil supply projects since joining GFANZ.
\nReclaim Finance Senior Analyst Paddy McCully added to\u00a0Pinson\u2019s comments by adding that the \u201cGFANZ members are acting as climate arsonists,\u201d indicating that it is because the members are \u201ccontinuing to pour hundreds of billions of dollars into fossil fuel developers.\u201d
\nAdele Shraiman from Sierra Club said:
\nDespite their high-profile commitments to net zero, US banks like Citibank and investors like BlackRock are continuing to support the development of oil, gas, and even coal through their investments and loans. The US financial sector cannot be taken seriously on climate change until it stops investing in new fossil fuel projects. We need an urgent transition to a green economy and the financial sector must help deliver that.
\nMake My Money Matter CEO Tony Burdon, who\u00a0endorsed the report, said:
\nWe know that financing for fossil fuel expansion is bad for the planet, contradicts any serious net zero commitment, and goes against the wishes of millions of savers who want their money tackling the climate crisis, not fueling the fire.\u00a0Yet staggeringly this report shows that our banks and our pension funds \u2013 underpinned by our money \u2013 continue to provide billions in finance to companies involved in such activity. This must change. Any financial institution who wants to be taken seriously on climate change must listen to the science, respond to their customers, and end their dangerous relationship with fossil fuel expansion.
\nRainforest Action Network\u00a0Climate and Energy Director\u00a0Aditi Sen also claimed that \u201cthe science is clear\u201d and that the \u201cfinancing of new oil, gas, and coal is incompatible with net zero.\u201d He added:
\nBy continuing to finance new fossil fuel projects, banks and asset managers are complicit in driving climate chaos. The US\u2019s top banks who are the world\u2019s biggest financiers of fossil fuels need to reconcile their actions with their rhetoric on climate by moving finance away from fossil fuel expansion towards a just energy transition.\u201d
\nUrgewald\u00a0Finance Campaigner\u00a0Regine Richter also stated:
\nDespite their high profile commitments to net zero, German banks and investors, including Deutsche Bank and DWS, are continuing to support the development of oil, gas and even coal through their investments and loans. The German finance sector cannot be taken seriously on climate change until it stops investing in new fossil fuel projects. We need an urgent transition to a green economy and the finance sector must help deliver that.\u201d
\nSome of the other groups that have made\u00a0similar comments\u00a0to\u00a0Reclaim Finance about the report\u00a0are\u00a0Eri Watanabe, a Senior Finance Campaigner of 350.org Japan;\u00a0Maaike Beenes, a Climate Lead at BankTrack;\u00a0Guillaume Durin, a campaigner at BreakFree Switzerland;\u00a0Guillaume Durin, a campaigner at BreakFree Switzerland; and\u00a0Daniela Finamore, a Finance & Climate Campaigner from ReCommon.<\/p>\n