Feb 1, 2025
Royal Bank of Canada has withdrawn from a global alliance of financial institutions formed to direct capital to meeting climate targets, making it the last of the country’s big banks to quit the group.
With the move, RBC joins numerous Canadian and U.S. banks that have bailed on the Net-Zero Banking Alliance (NZBA) in the past two months, fearing political backlash, legal action and loss of business in the United States after President Donald Trump’s return to the White House.
As they have cut ties with the NZBA, most of the institutions have said they intend to stick with their own efforts to meet decarbonization goals, even as federal and state Republican politicians pledge to stamp out corporate environmental, social and governance programs.
RBC offered such a message on Friday. “We have informed the NZBA that we will be departing the organization, as we now have the tools and capabilities to help implement our climate strategy and measure our performance,” RBC spokesperson Andrew Block said in a statement.
“We will continue to focus our efforts on supporting our clients to help them address climate change and succeed in the transition to a low-carbon and resilient economy.”
Environmental activists have criticized the financial institutions for their exits from the NZBA, though many deemed the alliance toothless after it relaxed its membership criteria away from previously established targets put forward by a UN climate organization.
The NZBA still counts about 135 banks from 44 countries as members, representing a total of US$57-trillion in assets. However, its North American ranks are vastly depleted, with just five institutions remaining, including two B.C. credit unions.
One of those, Vancity, said in a recent statement that its membership remains key to
meeting a target of net-zero emissions from its mortgages and loans by 2040. “With 2024 recently confirmed as the warmest year on record at approximately 1.55 degrees C above preindustrial levels, we remain committed to delivering emissions reductions and advancing the global transition to net zero. Vancity’s participation in the NZBA is one important part of this journey,” it said.
In the past two weeks, Bank of Montreal, National Bank of Canada, Toronto-Dominion Bank, Canadian Imperial Bank of Commerce and Bank of Nova Scotia have withdrawn from the NZBA. They followed U.S. banks JP Morgan Chase & Co., Bank of America Corp., Citigroup Inc., Wells Fargo & Co. and Goldman Sachs Group Inc.
The NZBA and other financial alliances operate under an umbrella called Glasgow Financial Alliance for Net Zero, or GFANZ, which was unveiled at the United Nations climate summit in 2021. At the time, there was much excitement over the potential for the might of the finance industry to be brought to bear on climate action.
Mark Carney, former Bank of Canada and Bank of England governor and now a federal Liberal leadership hopeful, and Michael Bloomberg, founder of Bloomberg L.P. and former mayor of New York, were co-chairs. Mr. Carney resigned that post when he announced his bid to become prime minister.
www.theglobeandmail.com
Royal Bank of Canada has withdrawn from a global alliance of financial institutions formed to direct capital to meeting climate targets, making it the last of the country’s big banks to quit the group.
With the move, RBC joins numerous Canadian and U.S. banks that have bailed on the Net-Zero Banking Alliance (NZBA) in the past two months, fearing political backlash, legal action and loss of business in the United States after President Donald Trump’s return to the White House.
As they have cut ties with the NZBA, most of the institutions have said they intend to stick with their own efforts to meet decarbonization goals, even as federal and state Republican politicians pledge to stamp out corporate environmental, social and governance programs.
RBC offered such a message on Friday. “We have informed the NZBA that we will be departing the organization, as we now have the tools and capabilities to help implement our climate strategy and measure our performance,” RBC spokesperson Andrew Block said in a statement.
“We will continue to focus our efforts on supporting our clients to help them address climate change and succeed in the transition to a low-carbon and resilient economy.”
Environmental activists have criticized the financial institutions for their exits from the NZBA, though many deemed the alliance toothless after it relaxed its membership criteria away from previously established targets put forward by a UN climate organization.
The NZBA still counts about 135 banks from 44 countries as members, representing a total of US$57-trillion in assets. However, its North American ranks are vastly depleted, with just five institutions remaining, including two B.C. credit unions.
One of those, Vancity, said in a recent statement that its membership remains key to
meeting a target of net-zero emissions from its mortgages and loans by 2040. “With 2024 recently confirmed as the warmest year on record at approximately 1.55 degrees C above preindustrial levels, we remain committed to delivering emissions reductions and advancing the global transition to net zero. Vancity’s participation in the NZBA is one important part of this journey,” it said.
In the past two weeks, Bank of Montreal, National Bank of Canada, Toronto-Dominion Bank, Canadian Imperial Bank of Commerce and Bank of Nova Scotia have withdrawn from the NZBA. They followed U.S. banks JP Morgan Chase & Co., Bank of America Corp., Citigroup Inc., Wells Fargo & Co. and Goldman Sachs Group Inc.
The NZBA and other financial alliances operate under an umbrella called Glasgow Financial Alliance for Net Zero, or GFANZ, which was unveiled at the United Nations climate summit in 2021. At the time, there was much excitement over the potential for the might of the finance industry to be brought to bear on climate action.
Mark Carney, former Bank of Canada and Bank of England governor and now a federal Liberal leadership hopeful, and Michael Bloomberg, founder of Bloomberg L.P. and former mayor of New York, were co-chairs. Mr. Carney resigned that post when he announced his bid to become prime minister.
Climate alliance loses last big Canadian bank as RBC withdraws
With the move, RBC joins numerous Canadian and U.S. banks that have bailed on the Net Zero Banking Alliance in the past two months
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