When Secretary of the Treasury Janet Yellen released updated guidance in September for the financial services sector to decrease its overall carbon footprint, some banks had already made significant investments toward reducing their institution’s contributions to climate change. “The principles are intended to mobilize more private-sector capital to mitigate the effects of man-made climate change, which is intensifying storms and warming the oceans to dangerous levels,” says Yellen, according to MarketWatch. Despite urging for banking to fully commit to the Paris Agreement, some bank portfolios are still expanding oil and gas holdings.
At a time when global banks are falling short of their carbon reduction goals, renewed climate action is urgently needed. And while the U.S. government has opted for a mostly voluntary framework for net-zero emissions in financial services, some notable big banks have not only made carbon reduction pledges for their institutions, they’re putting their money where their mouth is. Banks making financial commitments to achieving climate change goals include Goldman Sachs, JP Morgan Chase, Citi, and Bank of America. However, one future-focused bank is going even further.
With an aggressive goal to achieve carbon neutrality by 2035, Citizens is directly targeting greenhouse gases in business. Not only are they engaging with all of their clients in the oil and gas sector, the Providence, RI-based lender is earmarking $50 billion to sustainable finance, funds that will help commercial customers migrate away from carbon-based business. “Citizens plans to encourage its commercial bankers to help clients develop tailored strategies to transition them to a slimmer carbon output,” according to Banking Dive. “Including steering toward the bank’s recent sustainability products, such as carbon offset deposit accounts.”
Such direct actions are a reflection of the bank’s core commitment to the environment. Unlike many other financial institutions with net zero pledges in 2050, Citizens has a much more aggressive goal to reach carbon neutrality 15 years earlier. “In developing this program, we took a methodical, customer and client-centered approach, that includes detailed disclosures and reporting to ensure overall success,” said Beth Johnson, Citizens Vice Chair, Chief Experience Officer and Head of ESG in the bank’s announcement. The $50 investment includes affordable housing and support for small businesses and community development projects.
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