Wall Street’s Top Banks Just Quit a Once Popular Net-Zero Banking Alliance | Climate Change

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1. The Net-Zero Banking Alliance — a group dedicated to helping lenders reduce their carbon footprints — has in quick succession been abandoned by Goldman Sachs, Wells Fargo, Citigroup, Bank of America and Morgan Stanley. JPMorgan Chase, the largest US bank, looks to be next in line.

   The moves reflect US banks desire to shield themselves from increasing political pressure as Trump returns to the White House, according to those familiar who asked not to be identified discussing private deliberations. NZBA told members to brace for more US exits, citing the “political environment”

   At the same time, the real-world impact of the NZBA defections is unclear. Banks have collectively stepped up their financing of the fossil-fuel industry since the alliance was formed in 2021. Membership of NZBA was likely more a case of “virtue signaling” than “meaningful climate impacts.”

   NZBA then watered down some requirements, and members stayed put. But as the Republican Party grows more hostile toward climate-friendly organizations, the finance industry is repositioning itself.

   Global temperatures are rising fast, yet banks continue to reap short-term profits by sticking with fossil fuel producers. It’s therefore both “distressing and unsurprising” that Wall Street is turning its back on net zero alliances.

   Tufts University draws parallels between choices banks are making today, and those made in the lead-up to the 2008 financial crisis. To understand bank thinking now, it’s worth recalling a 2007 Citigroup CEO comment at the time: “‘As long as the music is playing, you’ve got to get up and dance’.”

   Vanessa Fajans-Turner, executive director at the nonprofit, said it’s clear Republicans have succeeded in their efforts to get Wall Street to retreat from climate commitments, “modest” as they were. “The banks won’t police themselves,” she said. “That’s why we need regulation.”

   Abridged (shortened) article thread ⏬ 9 min

   [https://bsky.app/profile/johnhatchard.bsky.social/post/3lexq5o3kqg2y](https://bsky.app/profile/johnhatchard.bsky.social/post/3lexq5o3kqg2y)

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