Canadian Banks Exit Global Climate Coalition Before Trump's Inauguration
TD Bank, Bank of Montreal, National Bank of Canada, and CIBC have exited the Net-Zero Banking Alliance, aligning with major U.S. banks.
On Friday, four of Canada’s largest banks announced they are leaving the Net-Zero Banking Alliance (NZBA), a global coalition focused on combating climate change.
The Canadian banks—TD Bank, Bank of Montreal (BMO), National Bank of Canada, and Canadian Imperial Bank of Commerce (CIBC)—are joining six major U.S. banks in departing from the initiative.
This decision comes after Goldman Sachs' exit on December 6 and precedes the inauguration of President-elect Donald Trump next week.
Trump has been outspoken in opposing climate-change policies advocated by governments.
The Net-Zero Banking Alliance, established in 2021 by former Bank of Canada Governor Mark Carney, is a UN-supported effort urging financial institutions to limit their carbon footprints and aim for net-zero emissions.
The alliance’s objective is to align the financial sector with the goals set by the Paris Climate Agreement.
In their statements, the Canadian banks asserted they are capable of pursuing their climate strategies independently from the alliance.
CIBC noted that the NZBA played a crucial role when it was founded, but the bank has now made significant strides in handling climate-related issues alongside its clients.
This decision reflects a shifting approach as the banking sector increasingly prioritizes climate risk management, in line with guidelines from Canada’s banking regulator.
These departures are part of a wider trend where financial institutions are re-evaluating their involvement in climate initiatives, with the U.S. Federal Reserve also withdrawing from a global group studying ways to address climate risk in the financial system.
The NZBA was initially established at a time when the global banking industry was ramping up its climate efforts.
The impact of these banks' withdrawal on the coalition’s future direction and the broader initiative for financial institutions to manage climate risks remains to be seen.
The Canadian banks—TD Bank, Bank of Montreal (BMO), National Bank of Canada, and Canadian Imperial Bank of Commerce (CIBC)—are joining six major U.S. banks in departing from the initiative.
This decision comes after Goldman Sachs' exit on December 6 and precedes the inauguration of President-elect Donald Trump next week.
Trump has been outspoken in opposing climate-change policies advocated by governments.
The Net-Zero Banking Alliance, established in 2021 by former Bank of Canada Governor Mark Carney, is a UN-supported effort urging financial institutions to limit their carbon footprints and aim for net-zero emissions.
The alliance’s objective is to align the financial sector with the goals set by the Paris Climate Agreement.
In their statements, the Canadian banks asserted they are capable of pursuing their climate strategies independently from the alliance.
CIBC noted that the NZBA played a crucial role when it was founded, but the bank has now made significant strides in handling climate-related issues alongside its clients.
This decision reflects a shifting approach as the banking sector increasingly prioritizes climate risk management, in line with guidelines from Canada’s banking regulator.
These departures are part of a wider trend where financial institutions are re-evaluating their involvement in climate initiatives, with the U.S. Federal Reserve also withdrawing from a global group studying ways to address climate risk in the financial system.
The NZBA was initially established at a time when the global banking industry was ramping up its climate efforts.
The impact of these banks' withdrawal on the coalition’s future direction and the broader initiative for financial institutions to manage climate risks remains to be seen.
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