These banks be trippin'

"I love sustainability," banks say, while financing fossil fuels in a far bigger way.

Oct 3, 2019

Welcome to HEATED, a newsletter for people who are pissed off about the climate crisis.

This week was a lot! So I’ll keep this one relatively short. I think we all need a bit of a break.

Next week, I’ll be in Denver and Fort Collins, Colorado for the Society of Environmental Journalists’ annual conference. It starts Wednesday, but I’m going a couple days early, because I have never been to Colorado before. Have suggestions for what I should do if I get free time? Know a good CrossFit box in the area? Email me: emily@heated.world.

New research on big banks and climate

“Oooh look at me. I’m a big bank. I love sustainability. Look at how much I love sustainability with all my sustainable investments.” That is my impression of a bank that be trippin’.

There are many banks that be trippin’, according to my interpretation of a World Resources Institute research tool released today. The tool allows users to measure sustainable investing commitments made by the world’s 50 largest banks, and compare them against the banks’ fossil fuel investments.

I say this is “my interpretation,” because that’s what WRI’s Giulia Christianson, said when I asked her if the tool shows big banks are acting like sustainability is their priority, when actually fossil fuels are their priority. “That is definitely one interpretation,” she said.

“We as WRI can’t go as far in saying that,” added Christianson, who is the group’s head of sustainable investing, continued. “But we can say that we’re happy that these sustainability commitments happen, because we need banks to do that, but we also want them to very transparent and accountable about those commitments while ramping down their investments in fossil fuels. That’s the only way we’re going to solve the challenge ahead.”

Which banks walk the talk?

Out of the world’s largest 50 banks, only 23 had sustainable investment commitments as of July 2019—that is, promises to provide funding or financing for low-carbon or otherwise environmentally friendly companies or projects.

These promises, according to WRI, “play a valuable role in signaling—both externally and internally—that banks intend to support sustainability in a measurable way.”

At the same time, 16 of those 23 big banks with sustainability commitments are making larger annual commitments to financing fossil fuels than they are to sustainable financing.

Those banks are:

JP Morgan Chase
Wells Fargo
Bank of America
HSBC
Goldman Sachs Group
Citigroup
BNP Paribas
Mitsubishi UFJ Financial Group
Toronto-Dominion Bank
Royal Bank of Canada
ING Groep
Lloyds Banking Group
Commonwealth Bank of Australia
Credit Agricole Group
Australia & New Zealand Banking Group

And here are the 7 big banks with annual sustainability commitments that are larger than their annual fossil fuel investments:

Barclays
Bank of Montreal
Société Générale
Standard Chartered
National Australia Bank
Westpac Banking
Banco Bilbao Vizcaya Argentaria

Important caveats

“Sustainable financing” is a pretty broad term—and not all “sustainable financing commitments” are created equal. “There is no standard definition for sustainable activities,” Christianson told me, and only some banks are clear about what they mean when they promises to finance such activities.

WRI tried to show that and much more in the graph below, which is much better in its interactive form, which you can access here. But here’s the gist: The circles represent banks with sustainability commitments. The size of the circle represents the size of the bank. The place on the graph represents the banks’ relative commitment to sustainability and fossil fuels—circles to the left of the diagonal line invest more in sustainability, and circles to the right invest more in fossil fuels. The color of the circle is how specific banks are about what “sustainability” means. Dark green is specific. Light green is vague.

Thus, Christianson said, “The sustainability commitments themselves do not necessarily tell the whole story.”

What they do tell us, however, is that JP Morgan Chase—the big circle to the very right—is still the freaking worst.

(That’s from the 2019 Fossil Fuel Finance Report Card, which you can find here, and is a great resource for learning about which banks are the biggest financers of fossil fuels around the world).

If you’d like to dive more into WRI’s research tool, you can find that here. There’s lots more interesting stuff I could get into about it, but like I said, I’m trying to keep it short today.

Here are also some links if you’d like to explore green banking options.

HOT ACTION: Grocery delivery waste edition, part 2

Here’s some more reader suggestions in response to my two-part investigation of the non-recyclable freezer bags that come with Amazon Prime Now grocery delivery.

From New Jersey-based reader Samarra Khaja:

Amazon should stop producing them. Period … [But] for the ones currently made that will clearly exists for the rest of eternity, I thought they could at least be re-purposed in thoughtful ways like:
A) They are PERFECT to cut open and sew together to make a tin man or robot costume.
B) On a more socially-conscious level, they could easily be sewn into winter sleeping bags/blankets for homeless people. Until homelessness is solved.

From Massachusetts-based reader John Hite, who is also a zero waste policy analyst at the Conservation Law Foundation:

We need to be pushing companies like Amazon to do exactly what you described in your newsletter—put a deposit on the container which you get back at your next drop-off. Susan may have shared the idea of Extended Producer Responsibility with you, which I’d encourage you to dig into if you haven’t yet. There is actually federal legislation under formation!

And one non-grocery related suggestion, from Jake Assael, lead researcher at Vote Climate USA PAC:

Vote Climate USA PAC recently released its 2020 Presidential Candidates Voter’s Guide.
It provides a climate calculation to all presidential candidates, scoring them on their climate position, climate plan, climate leadership, and stance on a carbon fee.
Come primary season, voters will be able to take HOT ACTION by using our guide at the ballot box to vote climate.

Seems useful. This Vox story has more information about Vote Climate USA PAC, if you’re interested.

OK, that’s all for today—thanks for reading HEATED!

If you liked it, please forward it to a friend. If you’ve been forwarded this, you can sign up for daily emails by clicking the button below:

Questions or comments about today’s issue? E-mail me: emily@heated.world

Suggestions for hot action? E-mail them to: action@heated.world

See you next week in Colorado!