– Big banks promise $130 trillion against climate change in Glasgow
450 international financial institutions want to fight climate change with huge funds. Environmentalists doubt they’re serious.
At the United Nations Global Climate Summit in Glasgow, Scotland, major banks and other national and international financial institutions agreed to use $130 trillion of their assets under management to combat climate change.
And about 450 banks, investment groups and pension funds from 45 countries, they admit, want to help avert climate catastrophe.
Concerned donors are supposed to withdraw support from companies that continue to deal with coal, oil or gas, and instead fund “green technology” and power generation. Institutions participating in the initiative have also committed to ensuring greater transparency and disclosure of investments of environmental importance.
State money is not enough
The hosts of the COP-26 conference in the UK see the new initiative as a particular success. British Chancellor of the Exchequer Rishi Sunak said on Wednesday he was “extremely proud that under the UK’s leadership, the number of financial firms committing to Net Zero’s plans has tripled.” “Together we can provide the money the world needs to stop catastrophic climate change.”
Overall, there is agreement in Glasgow that massive financial resources from the private sector are required to transition to the “zero global economy” that most countries are now seeking. State money alone – which is still being fought over – is not enough.
However, experts and anti-climate activists have reacted largely with skepticism to promises of a shift from the new Glasgow Financial Alliance for Net Zero (GFANZ), which includes banks such as HSBC, Santander and Bank of America. 15 financial institutions from Switzerland participate. These companies include UBS, Credit Suisse, Geneva Private Bank Pictet and Swisscanto, a subsidiary of Zürcher Kantonalbank.
Typical was a comment by the Green Alliance’s chief economist, Sam Alves, who noted that huge amounts of money are still flowing daily into the exploitation and use of fossil fuels, “and that voluntary actions in this context have not done enough”.
In order to achieve their goal of increasing the maximum temperature by 1.5 degrees Celsius, “governments should not only require large companies to submit transition plans, but also impose strict legal standards on them regarding the reliability and speed of the transition.” Elvis.
“Not everything is dedicated to combating climate change, and one cannot really talk about green finance as long as financiers show an undiminished interest in expanding into fossil fuels.”
Becky Jarvis, Nichtregierungsorganisation Bank on our future
Becky Jarvis of the Bank’s Campaign on Our Future described the new ads as “a mile wide, but only an inch deep.” GFANZ participants had only promised a third of their total capital, which is not yet enough, for a net zero goal.
“Not everything is dedicated to combating climate change, and one cannot really talk about green finance as long as financiers show an undiminished interest in expanding fossil fuels,” Jarvis said. Tom Pekin of the Rainforest Action Network complained of the daunting climate promises of the financial world and all the tangible management-level decisions being “widely spaced”. There is a lot of “green window decorating” in Glasgow.
London’s top finance newspaper, Financial Times, said on its front page yesterday that even the big promises they made at the Paris climate summit six years ago were by no means kept by many banks.
In many cases, these allegations have been “watered down”, the newspaper ruled. In the run-up to the Glasgow Summit, bank loans were scrutinized more intensely than before. But the relationship between the financial world and companies dealing with fossil fuels remains unbroken.
Doubts about London’s self-praise
However, in the crosshairs of criticism was also Chancellor of the Exchequer Sunak, who boasted that Britain’s financial center – the City of London – would become “the world’s first net-zero financial centre”.
Such an honor, the Greenpeace spokesperson responded, to go to a financial center that would put financial institutions and companies on a 1.5°C rate with clear and verifiable regulations and appropriate legal remedies.
Instead, the rules agreed in Glasgow have given banks and investors “a lot of leeway” to get off their self-imposed obligations and to operate “as usual”, meaning not being forced to change course for now.