Follow the $ – banks and climate

Bloomberg Digital posted an article on how big banks are cleaning up their investments and loan books to reduce and / or eliminate fossil fuel business. At face value, that sounds like a great idea regardless if one is an investor or a citizen of earth. But, as Bloomberg, points out … not all bank statements have the same veracity and depth.

Quote, “The proliferation of these initiatives underscores how hard it is to allocate responsibility for emissions in banking, an industry that was hardly known for its perspicacity even before climate change became an unavoidable corporate issue. Many are complimentary, so that any single financial institution might be involved in multiple pledges, initiatives and methodologies.”

Later in day update: Financial Times published another view on the topic, but focusing on asset managers and their climate risk reporting, and that work is being driven by Task Force on Climate-Related Financial Disclosures has (TCFD) chaired by Michael Bloomberg.

JP Morgan is one such example and by some accounts a vocal leader in the cleaning up of large banks. They dedicate a web page to sustainability – https://www.jpmorganchase.com/impact/sustainability. But what are the points they emphasize? (quoted below)

  • Our firm aims to facilitate $200 billion in financing in 2020 to drive action on climate change and advance the objectives of the United Nations Sustainable Development Goals (SDGs). 
  • Adopts a Paris-aligned financing commitment and commits to achieving operational carbon neutrality starting in 2020.
  • As part of our commitment, JPMorgan Chase will establish intermediate emission targets for 2030 for its financing portfolio. We will focus on the oil and gas, electric power and automotive manufacturing sectors and set targets on a sector-by-sector basis. To help advance the transition to a low-carbon economy and track progress towards Paris, the firm will aim to evaluate its clients’ carbon intensity, which tracks emissions relative to unit of output. When measured over time, carbon intensity provides insight into changes in efficiency, performance and business strategy.

An incomplete story imho with the greatest impact to climate within their portfolio getting kicked down the road to 2030. JPM is one of the better stories that I have found, and their sustainability page has great resources. We’re making progress but just like decades ago wrt South Africa, until global corporations fear their own money being lost be them going slow … they will go slow.

We all need to make our voices heard and keep our capital directed toward those who do not and will not negatively impact our progress toward a cleaner earth.

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