UN-backed climate banking alliance ceases operations

PARIS: The Net-Zero Banking Alliance, a UN-backed initiative seeking carbon neutral investments by banks, announced Friday its immediate shutdown — at a time of faltering climate commitments in the United States and Europe.

Launched in 2021 under the UN Environment Programme’s Finance Initiative, the NZBA aimed to get banks to slash the carbon footprint of their loans and investments, and help drive the transition to a net-zero economy by 2050.

Read more: Heat-related deaths in Spain up 88% from last year

At its peak, the group counted nearly 150 members.

But the alliance had been losing members since late last year, after Donald Trump won the US presidential election with his “drill, baby, drill” mantra promoting oil and gas production.

Six major US banks — including JPMorgan Chase, Goldman Sachs and Bank of America — quit, followed by Canadian and Japanese lenders.

Read more: Heavy rains in store after longer-than-usual summer

The NZBA had paused its activities in late August while waiting for the result of a vote by its members.

“Members of the Net-Zero Banking Alliance (NZBA) have voted to transition from a member-based alliance and to establish its guidance as a framework,” an NZBA spokesperson said in a statement.

“As a result of this decision, NZBA will cease operations immediately,” the spokesperson said.

The NZBA said banks can still use the initiative’s “Guidance for Climate Target Setting for Banks”, which focuses on decarbonisation targets.

“Individual banks worldwide can continue to use and reference these resources to help develop and deliver on their own net-zero transition plans,” it said.