FILE PHOTO: A sign for the Bank of Montreal in Toronto, Ontario, Canada December 13, 2021. REUTERS/Carlos Osorio/File Photo
TORONTO: Toronto-Dominion Bank, Bank of Montreal (BMO) and National Bank of Canada are walking away from the industry’s biggest climate-finance alliance, joining Wall Street peers and extending an exodus that started in early December.
While the Canadian lenders said they’re no longer members of the Net-Zero Banking Alliance (NZBA), all three said they’re still committed to meeting climate- related targets.
The departures from NZBA started last month when Goldman Sachs Group Inc left the group.
The firm’s exit was followed by Morgan Stanley, Wells Fargo & Co, Bank of America Corp, Citigroup Inc and JPMorgan Chase & Co.
The moves coincide with intensifying Republican attacks on what US conservatives call “woke” capitalism and criticisms that such voluntary alliances haven’t had a meaningful impact on reducing greenhouse gas emissions.
Now the defections are stretching to Canada.
BMO chief executive officer Darryl White said at an industry conference last week that the bank supports the transition to a low-carbon economy regardless of the “mechanism.”
He added that the company also has “a commitment, particularly here in Canada, to our legacy energy customers completely. We won’t abandon that.”
In announcing its decision to leave NZBA, BMO said last Friday that it has “robust internal capabilities to implement relevant international standards, supporting our climate strategy and meeting regulatory requirements.”
Toronto-Dominion said in its statement that it has “the resources, relationships and capabilities to continue to advance our strategy, deliver for our shareholders, and advise our clients as they adapt their businesses and seize new opportunities.
Montreal-based National Bank, Canada’s sixth-largest lender, said it has decided to “streamline how we report on our plans and our progress.”
“We will continue to have a pragmatic approach and work with companies across all sectors, including large emitters and renewable energy providers, to promote impactful decarbonisation strategies,” Debby Cordeiro, National Bank’s senior vice-president of communications, said in an emailed statement.
NZBA sent a message to members last week, saying it was focusing on its “next phase” to continue to help banks manage climate-related risks and opportunities.
Canadian banks were some of the biggest providers of finance to oil, gas and coal in 2024, with Toronto-Dominion, Royal Bank of Canada, BMO and Canadian Imperial Bank of Commerce ranking among the top 10 for such deals, according to data compiled by Bloomberg.
The biggest provider of fossil-fuel finance last year was JPMorgan.
Other climate alliances also have lost high-profile members.
Just over a week into the new year, BlackRock Inc said it was ending its membership in the Net Zero Asset Managers initiative.
The firm, which was among a group of asset managers singled out in a lawsuit led by Texas alleging antitrust breaches due to the adoption of pro-climate strategies that suppress coal production, said staying inside NZBA had exposed it to “legal inquiries.”
In 2023, a net zero group for insurers saw a mass walkout amid the Republicans’ litigation threats.
A similar group for investors, Climate Action 100+, was hit by high-profile defections last year as the asset management arms of Goldman and JPMorgan, as well as Pacific Investment Management Co all left. — Bloomberg
