Wall Street Breaks with Zero Climate Alliance Ahead of Trump’s Term

Wall Street’s biggest banks simultaneously pulled out of the same Zero Climate Alliance that was scrutinized by Republican lawmakers last year, announced just weeks earlier. President-elect Donald Trump will take the oath of office.

Since 2021, the banking giants have been prominent members of the Net-Zero Banking Alliance (NZBA), a global group of financial institutions “Committed to finance ambitious climate action” to transition the economy to net zero greenhouse gas emissions by 2050.

However, since December, six of the world’s largest banks – JP Morgan, Wells Fargo, Goldman Sachs, Morgan Stanley, Citigroup and Bank of America – have separately announced their departure from the alliance, which encourages its member banks to “design, establish” and achieve” science-based net zero goals.

The banks said they remain committed to emissions reduction targets, but will do so independently.

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The sign and exterior of the JPMorgan Chase & Co. building is seen. in New York City. (Plexi images)

“We will continue to work independently to advance the interests of our firm, our shareholders and our customers and remain focused on pragmatic solutions to help further low-carbon technologies while advancing energy security,” said a spokesperson for JP Morgan, the latest bank to pull out. of the alliance, he said in a statement.

BlackRock, the world’s largest investment firm, also announced Thursday that it was splitting from a major climate group, the Net Zero Asset Managers Initiative, which works with asset managers to achieve net zero emissions by 2050 or earlier.

The synchronicity of the departures comes just weeks before Trump is expected to break with President Biden. objective of reducing greenhouse gas emissions and possibly withdrawing from the Paris Climate Agreement, will assume the presidency.

A Wall Street sign in front of the New York Stock Exchange in New York City on Wednesday, July 31, 2024. (Michael Nagle)

“The sudden exodus of these big US banks out of the NZBA is an incredible effort to avoid criticism from Trump and his fellow climate deniers,” said Paddy McCully, senior analyst at Reclaim Finance, The guardian

“A few years ago, when climate change was at the top of the political agenda, banks were willing to brag about their commitments to act on climate,” McCully added. “Now that the political pendulum has swung the other way, suddenly acting on the climate doesn’t seem so important to Wall Street lenders.”

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The departures come nearly a year after a group of House Republicans launched a probe to the six banks for their involvement in the international alliance on claims that could affect the agricultural sector.