Where Do We Go From Here
The road ahead for banks will be difficult as they try to navigate the expectations to decarbonize with concerns about divesting too quickly, especially at a time when oil prices are rising.
For their part, advocates say their pressure will only intensify because while banks may be too big to fail, they are too important to ignore. That means more annual report cards on fossil fuel investments, more rallies in front of bank branches and head offices, and more campaigns on social media platforms such as Instagram.
Ramirez has no plans to let up. She and her young colleagues will continue to press their case because as they see it, theres no time to lose.
Is Your Money Financing Climate Change
Money deposited into your bank account on the high street isnt part of investment bank funding, which is where money for fossil fuel companies comes from. But major banks like Barclays have investment arms, which are a core part of the system causing climate change.
Its high time banks like Barclays were held up alongside fossil fuel companies as the main architects of the climate crisis. Instead of bankrolling oil drilling and deforestation, they should be pumping billions into renewable energy and forest restoration.
Green Bank Means Sustainable Banking
If you know where your bank invests, it gives you the power to make wise eco-friendly banking choices that support environmental goals. Ando is one example of sustainable banking with environmental protections at its core.
According to the company, Ando invests 100% of customer deposits in green initiatives exclusively, like renewable energy and regenerative farming, allowing users to have the single greatest individual impact on reducing carbon emissions and healing the planet.
While sustainable finance is a catchy headline phrase, the current actions are woefully insufficient. The percentage of banks heavily focused on investing in regenerative farming, carbon reduction and efficient waste systems is miniscule. As the zeitgeist continues to shift, however, your decision about what bank to support becomes even more crucial.
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Development Banks Still Pouring Billions Into Fossil Fuels In Climate
Three of the worlds biggest development banks have kept investing heavily in fossil fuels in some of the worlds most climate-vulnerable countries, according to new Oxfam research.Oxfam urges these banks to drop their support for dirty energy projects and focus on kick-starting a clean energy revolution.In Powering the Transition, Oxfam details how together, the World Bank, the Asian Development Bank, and the Asian Infrastructure Investment Bank are investing almost $5 billion in fossil fuels in the 10 Asian countries that belong to the Climate Vulnerable Forum.
The research comes just two days after a landmark report by the Intergovernmental Panel on Climate Change said the world must reach net zero emissions by 2050 to hold global warming to 1.5 degrees Celsius. The CVF countries have committed to using 100 percent renewable energy by 2050.
Lan Mercado, Oxfams Asia regional director, said: Against all odds, the countries of the Climate Vulnerable Forum are leading in the fight against climate change. The World Bank and other institutions now face an important test: are they going to keep funding fossils or are they going to kick-start a renewable energy revolution and help these countries achieve their ambitious goals?
Oxfams report also calculates the climate damages related to some of these projects:
Move Your Money Out Of Fossil Fuels
Once we put money in our bank accounts, we tend to think that it just sits there until we spend it. But in fact, your hard-earned cash can be invested anywhere in the world, and not necessarily in ways we would approve of.
From UK fracking sites to coal mines in Colombia, banks pursue profit at the expense of the climate. Three UK banks in particular, HSBC, Barclays and RBS, are among the banks which have invested in the company building the Dakota pipeline. HSBC, Barclays and Aviva have also invested in Kinder Morgan, which has just been granted permission by the Canadian government to build a massive tar sands pipeline – a disaster for the climate and potentially ‘Canada’s Standing Rock’ because of strong opposition from indigenous peoples. Anyone can contact these banks to tell them to pull their money out of this shameful project, but the greatest impact will be if customers divest their own bank accounts.
Luckily, switching to a more ethical bank is easy! Check out some of the resources below on which banks are worth switching to and then head over to Current Account Switch to get the process started quickly and easily.
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How Much Do Banks Invest In Fossil Fuels
The UKs five biggest banks Barclays, HSBC, Natwest, Lloyds Banking Group and Standard Chartered invested nearly £40.4bn into the coal industry alone between 2018 and 2020, according to campaigners Urgewald and Reclaim Finance.
Barclays put the most money into companies planning to expand the use of fossil fuels, investing more than £20bn.
HSBC invested nearly £11bn into coal companies over the two year period, including direct support for coal infrastructure in Bangladesh.
Less than one per cent of the money in the worlds largest 100 pension funds were put towardslow-carbon efforts in 2018, according toresearch by ShareAction. Cash held in current and savings accounts is unlikely to link directly to greenhouse gas emissions because the law means retail banking and investment banking must be kept separate. But that doesnt mean the bank you use to manage your money isnt financing schemes which are bad for the planet.
Is Your Bank Funding Fossil Fuels
The UK financial sectors investment in fossil fuels has increased since the Paris Agreement was struck in 2015. Heres how you can investigate your own bank
Eight in ten HSBC and Barclays customers didnt know the banks invested in fossil fuels. Image: Pexels
Youre at risk of contributing to theclimate crisis just by having a bank account.
The worlds 60 biggest private banks have funnellednearly £2.8 trillion into fossil fuels since the Paris Agreement to reduce greenhouse gas emissions was struck in 2015. UK banks backing of the coal industry has increased by 40 per cent since the same year.
Banks can use your money whether held in an account, pension or other investments to loan to or invest in businesses around the world. That can mean your money goes to building an oil pipeline, or deforesting projects which displace vulnerable communities.
Campaign group Reclaim Finance warned the UKs financial sector was actively undermining efforts to reach net-zero carbon emissions and called for banks to divest from fossil fuels urgently. The City of London was the biggest investor in coal of all Europes financial centres, the campaigners said, and the third biggest in the world.
Its not always easy to find out how banks invest their cash, but a new tool from Bank.Green means you caninvestigate your own bank for free.
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Avoid The Biggest Banks
The most commonly-found banks in the country are nearly all associated with funding non-renewable resources. According to the Rainforest Action Network, JP Morgan Chase, Wells Fargo, Citi, Bank of America, TD, Morgan Stanley, and Goldman Sachs are the seven most-popular banks. They also fund the most fossil fuels.
Exclusive Shareholder Group Pressures Us Banks To Drop Fossil Fuels Faster
Pump jacks operate at sunset in Midland, Texas, U.S., February 11, 2019. REUTERS/Nick Oxford
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The investors have filed resolutions to try to bring the matter to shareholder votes at the annual meetings of the banks in 2022, according to documents seen by Reuters.
Banks receiving the resolutions include the nation’s six largest by asset size — JPMorgan Chase & Co , Bank of America , Wells Fargo & Co , Citigroup Inc , Morgan Stanley and Goldman Sachs Group Inc .
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All six have already committed to curbing global emissions. The resolutions from members of the Interfaith Center on Corporate Responsibility go further, effectively seeking an immediate end to the financing of new fossil fuel development in line with calls this year from global watchdog the International Energy Agency.
Representatives for Citigroup, Morgan Stanley, and Goldman Sachs declined to comment. Representatives from Bank of America did not respond to questions for this article.
A Wells Fargo representative declined to comment on the resolution but noted other climate-focused steps the bank has taken such as planning $500 billion in financing for sustainable businesses and projects by 2030.
Additional resolutions ask Bank of America and Citigroup to report on how a dire climate forecast could cause some assets to face premature devaluation, such as underground oil and gas reserves.
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Will Anything Change As A Result Of Cop26 In Glasgow
The COP26 climate conference in November 2021 saw lots of headline-grabbing announcements on deforestation, including the Glasgow Declaration on Forests and Land Use, which pledged to halt and reverse forestation by 2030. However, this risks being more of the same weak voluntary commitments that have failed to deliver results, following in the footsteps of the similar 2014 New York Declaration of Forests.
The forest commitments at COP26 were also accompanied by almost £14 billion in public and private funding and a welcome promise of increased support for Indigenous Peoples and local communities.
These communities are the guardians of more than one third of the worlds forests and 80% of all terrestrial biodiversity, yet they currently receive less than 1% of global climate finance.
Unfortunately, the funds announced at COP26 are dwarfed by the huge amounts of money which flow from the financial sector to companies linked to deforestation and related abuses.
A new report from Global Witness reveal how financiers public pledges are consistently and repeatedly contradicted by their actual financing decisions as they continue to profit from deforestation and associated abuses, highlighting their hypocrisy and greenwashing.
The recent investigation also found that banks and asset managers based in the EU, UK, US and China have made deals worth $157 billion with firms accused of destroying tropical forest in Brazil, South East Asia and Africa since the Paris Climate Agreement.
Socially Responsible Banking Options
if you dont find a bank thats eco-focused that meets your needs, you may be interested in exploring other socially responsible bank options, like banks that invest in low-income communities and communities of color, banks owned or led by people of color, and . These banks by the nature of their business on serving communities in more of a grassroots fashion than large chains are by default greener options than the largest chains, which are the driving financing force behind the expansion of the fossil fuel industry. The complete guide to socially responsible banking lists additional options.
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Fossil Fuel Expansion Projects
UK banks continue to finance some of the most controversial fossil fuel projects and companies around the world.
Based on information collected by BankTrack, Urgewald and the Banking on Climate Change 2020 report, we look at the devastating impact two of these projects are having on the environment and local communities.
Project: TransMountain Pipeline Expansion project
Country: Canada
Linked banks: AIG, Barclays, Chubb, Citigroup, Deutsche Bank, HSBC, NatWest
The TransMountain Pipeline Expansion project will nearly triple the flow of tar sands which produce 15% more carbon dioxide emissions than conventional oil from the Alberta oil sands to the Canadian coast. Local communities already face oil spills from the pipeline.
In June, 190,000 litres of oil split over an aquifer that supplies water to the indigenous community Sumas First Nations reserve. It was the fourth spill in 15 years on the communitys land.
Many groups of First Nations say that they have not been properly consulted and that the pipeline is a threat to their way of life.
Campaign group, Stand.earth says that the expansion will lead to 590,000 more barrels of tar sands each day and an almost 7-fold increase in oil tankers in the Salish Sea, endangering the Orca Whale population.
Manuel is a member of the Secwepemc Nation resisting the pipeline:
This movement is reclaiming our lands, our cultures, our language. Our language and culture flows from our land, you cant have one without the other.
Why Its On Jpmorgan Chase To Change The Course Of The Climate Crisis
We tackle some of the biggest problems of the 21st century climate change, extreme fossil fuel extraction, massive deforestation and rampant labor abuse. But we dont target one company at a time. We target whole industrial sectors. We fight for systemic change because its not about what is possible its about what is necessary.
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Opinion: Switching To Fossil
This regular column on tips to live more sustainably comes from the 52 Weeks Climate Action Challenge. The challenge was created by Laurel Hood and Sherri Jackson. Hood is a retired Collingwood Collegiate Institute teacher, and Jackson is a writer and speaker, and ran as the Green Partys candidate for the area in the last federal election. Both are climate activists.
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Did you know that while the rest of us have been trying to reduce our carbon footprints and looking for ways to heal the planet, our five big banks have been doubling down on investing in fossil fuels, and working against the Paris Climate Accord?
It seems they havent gotten the message that the world is moving toward sustainability. Instead, theyre doing what lots of big business is doing. Burying their heads in the sands, and ignoring that the world is on fire.
Heres the really disturbing part. From 2016-2019, Canadian banks invested $482 Billion in the fossil fuel industry globally. And, domestically, they finance about 70 per cent of the oil sands. Our banks. After the Paris Accord. You know, where Canada committed to serious action on climate change? Epic failure on all our parts.
Internationally, Canadian banks are some of the top contributors to climate catastrophe. RBC leads the dubious pack, with over $135 billion in fossil fuel investment since 2016. Thats your money.
If your bank wont divest from fossil fuels, divest from your bank.
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Our Demands Of The Banks Funding The Climate Crisis
The era of big banks avoiding responsibility for the very real-world consequences of their investment decisions is over. Emissions have to drop by almost half by 2030 and going forward, the banks fossil financing has to match that trajectory.
Big banks must take responsibility, and play an integral part in initiating the move away from fossil fuels. Weve taken on the tasks of pushing these banks to defund climate change, specifically the worlds worst banker of climate change: JPMorgan Chase.
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Global Snapshot Of Fossil Fuel Sector Finance
Past report cards by the groups have focused only on coal, or on extreme fossil fuel projects, like tar sands extraction, ultra-deepwater oil drilling, and coal mining, and power generation. 2019s report card expands, for the first time, to cover the fossil fuel sector as a whole.
Total fossil fuel financing, in billions of U.S. dollars, by bank and year, 2016-2018. Credit: Banking on Climate Change 2019 report
This years report card also dived deep into lending to shale oil and gas companies for the first time, finding that Wells Fargo and JPMorgan Chase are the biggest bankers of fracking overall and, in particular, they support key companies active in the Permian Basin, the epicenter of the climate-threatening global surge of oil and gas production.
JPMorgan Chase also provided the most financing to LNG projects, Arctic oil and gas projects, and ultra-deep-water oil and gas extraction, the report concluded. The Royal Bank of Canada topped the list on tar sands oil financing.
Coal mining finance is dominated by the four major Chinese banks, led by China Construction Bank and Bank of China, the 2019 report found, adding that Bank of China provided the most financing to coal power projects as well.
On March 19, Chinas State Development & Investment Corp., listed as one of the reports top coal power companies, reportedly confirmed that it would stop investing in thermal coal power plants three years ahead of schedule.
Inserting Politics Into Market
Those opposed to this bill including city and state governments, environmental advocates and the finance industry find those arguments ironic. If the goal of the bill is to keep politics out of the market, this does the exact opposite, they say.
This bill most certainly inserts politics into the free market and into the business of banking, said Dax Denton with the Indiana Bankers Association.
It would force financial institutions to prioritize certain industries regardless of the traditional risks or concerns that are considered. Rather, Denton said, it would create a new standard that banks must now be aware of when making business decisions with the fossil fuel industry.
That standard is the perception we will be viewed as boycotting a fossil fuel business regardless of prudent business decisions and risk in the marketplace, Denton continued.
The marketplace seems to be moving away from fossil fuels on its own.
Large segments of the utility sector are ditching coal and gas for economic reasons more than one-quarter of currently operating coal plants are set to be retired by 2035. To replace them, many utilities are building out their renewable options, which are increasingly cost effective. In fact, the U.S. Department of Energy estimates that renewable energy has the potential to provide 80% of the countrys power generation by mid-century.
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