Big Banks' Betrayal

 

There's a term for them, "fossil banks." These are the big banks that routinely talk a good game about moving out of fossil fuel investments into green energy instead. But, when the big money flows, talk is cheap.

The world’s biggest 60 banks have provided $3.8tn of financing for fossil fuel companies since the Paris climate deal in 2015, according to a report by a coalition of NGOs.

Despite the Covid-19 pandemic cutting energy use, overall funding remains on an upward trend and the finance provided in 2020 was higher than in 2016 or 2017, a fact the report’s authors and others described as “shocking”.

Oil, gas and coal will need to be burned for some years to come. But it has been known since at least 2015 that a significant proportion of existing reserves must remain in the ground if global heating is to remain below 2C, the main Paris target. Financing for new reserves is therefore the “exact opposite” of what is required to tackle the climate crisis, the report’s authors said.

US and Canadian banks make up 13 of the 60 banks analysed, but account for almost half of global fossil fuel financing over the last five years, the report found. JPMorgan Chase provided more finance than any other bank. UK bank Barclays provided the most fossil fuel financing among all European banks and French bank BNP Paribas was the biggest in the EU.

In Canada, the Big Dog is The Royal Bank.  

The report outlining the data, titled Banking on Climate Chaos 2021, is the 12th annual tally of fossil fuel financing by a group of seven climate advocacy organizations, including Rainforest Action Network and the Sierra Club, both based in the United States.

Three of the top 12 spots are claimed by Canadian banks - RBC, TD and Scotia.

“When we look at the five years overall, the trend is still going in the wrong direction, which is obviously the exact opposite of where we need to be going to live up to the goals of the Paris Agreement,” said Alison Kirsch, at Rainforest Action Network and an author of the report. “None of these 60 banks have made, without loopholes, a plan to exit fossil fuels.”

“We have seen progress in restricting financing for special places like the Arctic or greenhouse-gas-intensive forms of oil, like tar sands, but these are such a small piece of the pie,” she said.


Comments

  1. That's disturbing. I thought with the oil companies pulling out of the Tar Sands, Canadian banks would follow suit.

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    Replies
    1. It may be the one foot on the boat, the other on the dock dilemma, Owen. Our banks and pension funds have been enthusiastic investors in the Tar Sands and Canada's fossil energy economy. Changing course could be more perilous for a Canadian bank than for foreign investors such as BlackRock. Not everyone in Canada, particularly in the West, would see the altruism in a fossil energy 'defection.' There's no telling what sort of knock-on consequences it might trigger. Would Bay Street approve?

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