In the wake of yet another dire warning of what’s to come if we don’t act immediately to curb climate pollution, it feels more urgent than ever that everyone, from the government to the private sector, be doing everything they can to change course and tackle this crisis.
Unfortunately, a new report released today shows that, rather than being part of the solution, major banks are pouring gasoline on the fire. Banking on Climate Change 2019, the tenth annual report card tracking banks’ financing for the fossil fuel industry, paints a troubling picture of the financial industry’s role in worsening climate change, particularly among America’s largest banks.
The report, compiled by Rainforest Action Network, BankTrack, Indigenous Environmental Network, Oil Change International, Honor the Earth, and the Sierra Club -- and endorsed by more than 160 organizations around the world -- is the most comprehensive edition of the report card yet. It’s the first ever analysis of funding from the world’s major banks, not just for certain sectors like coal or tar sands, but for the fossil fuel industry as a whole.
The findings of the report are pretty disturbing. 33 of the world’s largest banks have pumped $1.9 trillion into the fossil fuel sector over the past three years since the Paris Climate Agreement was signed, with financing on the rise each year. $600 billion of this financing went to 100 top companies aggressively expanding fossil fuels.
Despite saying they support the Paris Agreement and making public commitments to sustainability and social responsibility, big banks like Wells Fargo have not only failed to cut ties with corporate polluters, but they’ve actually gone so far as to increase their funding of dirty fossil fuels every year. With the report’s expanded scope, we also now know that Wells Fargo is the #1 banker of fracked oil and gas in the world, with an alarming total of nearly $30 billion to the sector since the Paris Agreement.
In fact, all of the big U.S. banks were among the worst offenders worldwide. The four biggest global bankers of fossil fuels are JPMorgan Chase, Wells Fargo, Citi, and Bank of America.
With Morgan Stanley and Goldman Sachs in 11th and 12th places respectively, all six of the U.S. banking giants are in the top dirty dozen bankers of climate change. Together, U.S. banks account for 37% of all global fossil fuel financing, and the biggest source of funding for fossil fuel expansion since the Paris Agreement was adopted. Despite many of these banks declaring their support for the Agreement, none of them have made commitments to phase out fossil fuel investments in line with its targets.
It’s not just the climate these investments are putting at risk. Extreme energy projects like tar sands pipelines or Arctic drilling also pose serious threats to public health and human rights, often of Indigenous people and other marginalized communities. The report provides case studies of fossil fuel fights around the world — from the three major proposed tar sands oil pipelines in North America, to the Arctic National Wildlife Refuge, to open-pit coal mines in Europe — that highlight banks’ lack of effective policies to prevent them from financing destructive projects and the companies behind them.
Despite the report’s damning conclusions, there are a few bright spots in the banking sector’s move away from fossil fuel financing. Out of the 33 global banks analyzed in the report: 21 banks have restricted some coal financing, including 9 new restrictions on coal finance since last year’s report card; 10 banks (all based in Europe) have restricted some tar sands financing; and 9 banks have restricted some Arctic oil and gas financing, with at least two banks explicitly ruling out funding for development in the Arctic Refuge.
Nonetheless, even with these bits of progress, the overall story of banks’ fossil fuel financing is dire. At a time when science tells us we need to rapidly transition to clean energy, these banks are placing themselves on the wrong side of history by continuing to offer a blank check to the fossil fuel industry. The global outcry for financial institutions to stop financing climate destruction and human rights violations will only grow louder and more powerful until these banks get the message and pull their support for dirty fossil fuels once and for all.
Take action now: Tell the CEOs of America’s six largest banks to stop funding fossil fuels at sc.org/dirtybanks.