Nonprofits call on banks to raise the bar for net zero delivery

One Earth joined a coalition of global nonprofit organizations that recently sent a letter to the UN Environment Programme Finance Initiative (UNEP-FI) and the Net Zero Banking Alliance (NZBA) steering committee, urging NZBA members to restrict their financing of fossil fuel projects, including coal, in order to align with the recently strengthened Race to Zero criteria.

The UN-backed Race to Zero campaign, of which the NZBA is a partner, updated its criteria for members in June. The seven net zero alliances under the Glasgow Financial Alliance for Net Zero (GFANZ) umbrella are required to meet the updated minimum criteria by June 2023.

The coalition of nonprofits are extremely concerned by reports that a UNEP-FI spokesperson said it is unlikely that individual alliances will need to update their core commitments to meet Race to Zero’s new rules. The organizations warn that this undermines the credibility of UNEP-FI role as convenor of three of the GFANZ member alliances and its net zero commitment.

In its letter, the group asked the NZBA to respond urgently by outlining the timeline and process for updating its guidelines to maintain its accreditation, as well as the accountability mechanism that will ensure its members are aware of and will comply with their obligations.

The letter urged the NZBA to go beyond the UN’s minimum ‘Starting Line’ criteria by also playing a proactive leadership role, such as explaining how they will support climate-affected communities to ensure a fair transition.

The NZBA plans to review its guidelines by April 2024. The coalition called for this to be brought forward so that members can adjust their policies in time for the June 2023 deadline.