Barclays has become the latest bank to withdraw from the Net Zero Banking Alliance (NZBA), citing the previous departure of ‘most of the global banks’ from the UN-backed coalition.
In a statement, the bank said that the NZBA ‘no longer has the membership to support our transition’, adding that it remains committed to its ambition to be a net zero bank by 2050.
‘Our targets to mobilise $ 1trillion of Sustainable and Transition Financing and for financed emissions remain unchanged,’ Barclays said in a statement. ‘We continue to work with our clients on their transition, finance the transition and scale climate tech, while helping to ensure energy security for our customers and clients.’
Barclays added that last year, it generated approximately £500 million from sustainable and transition-related activity.
Net zero commitments
The move is a fresh blow for the alliance, which was established to align banks’ and financial institutions’ portfolios with global climate goals and net zero commitments.
Earlier this year, with the return of Donald Trump to the White House, a number of US banks withdrew from the NZBA, including JP Morgan, Citigroup, Bank of America, Morgan Stanley and Goldman Sachs.
Read more: Withdrawal of banks from climate alliances risks eroding public trust
‘Delivering on the future vision’
Following Barclays’ decision to exit the alliance, an NZBA spokesperson said, “NZBA remains focused on delivering on the future vision overwhelmingly endorsed by member banks a few months ago. It is supporting its members to lead on climate by addressing the barriers preventing their clients from investing in the net-zero transition.
“As the largest global initiative specifically focused on supporting climate mitigation action by banks, NZBA is uniquely positioned to provide the practical support banks need to grasp the opportunities and manage the risks of the move to net zero.”
Elsewhere, Jeanne Martin, co-director of corporate engagement at responsible investment NGO ShareAction, described Barclays’ announcement as a “step in the wrong direction”, at a time when increased investment in climate change should be prioritised.
“The announcement comes just three days after Barclays published a transition update reiterating its commitment to be a net zero bank by 2050, sending mixed signals to governments and companies around the world,” Martin said.
“As the financial risks of global heating multiply and climate impacts like heatwaves, floods and extreme weather events become more intense and frequent, we cannot afford half-measures. Responsible investors will be watching closely and raising the pressure on the bank to protect long-term economic prosperity and the livelihoods of people everywhere.”
HSBC’s withdrawal
In July, HSBC, which was one of the founding members of the alliance, announced that it too was leaving the NZBA, stating that the coalition ‘played a role in developing guiding frameworks to help banks establish their initial target-setting approach’.
However, with this foundation now ‘in place’, it decided to withdraw from the alliance, adding that its ‘approach to setting financed emissions targets will continue to be informed by the latest scientific evidence and credible industry-specific pathways’.
Banks that remain committed to the NZBA include Standard Chartered, whose chief executive Bill Winters, was recently quoted by The Guardian as criticising the departure of other financial institutions, saying “shame on them”. Read more here and here.
Read more: Swiss bank UBS withdraws from Net-Zero Banking Alliance
