Glasgow Financial Alliance for Net Zero continue to finance fossil fuel, says

56 largest banks funded fossil fuel industry USD 270 billion after joining GFANZ


January 19, 2023

/ By / Paris

Glasgow Financial Alliance for Net Zero continue to finance fossil fuel, says

58 biggest members of NZAM held USD 847 billion of stocks and bonds in 201 major fossil fuel developers

Accusing world’s largest financial insitutions of throwing fuel on the fire, global environmental activist organisation says that despite having joined the Glasgow Financial Alliance for Net Zero, the largest banks have continued to development and expansion of finance fossil fuel.

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A new report has accused the world’s largest banks and financial institutions of continuing to finance expansion of fossil fuel production around the world even years after having joined the Glasgow Financial Alliance for Net Zero (GFANZ), committed to net zero and pledged not to finance industries that continue to add to greenhouse gas emissions.

The report, prepared by a group of NGOs, including Reclaim Finance and, says that after committing to net zero by joining the Glasgow Financial Alliance for Net Zero (GFANZ), financial institutions, including Mitsubishi UFJ Financial and Nomura Asset Management, have continued pouring hundreds of billions of dollars into the companies developing fossil fuels.

The NGOs say that as business and finance leaders meet in Davos for the World Economic Forum, Reclaim Finance calls on GFANZ’s sectoral alliances to insist their members stop supporting fossil fuel expansion. If they are serious about meeting their commitment to reach net zero by 2050 following a 1.5°C pathway, action is needed now to align in the short term with this science-based climate imperative, say the NGOs in a press statement.

The report analyses support for the world’s largest fossil fuel developers from the financial institutions who are members of the sectoral alliances. One of its key findings is that since joining the alliance, 56 of the biggest banks in the Net-Zero Banking Alliance (NZBA) have provided USD 270 billion to 102 major fossil fuel expanders, via 134 loans and 215 underwriting transactions, while 58 of the largest members of the Net Zero Asset Managers initiative (NZAM) held at least USD 847 billion of stocks and bonds in 201 major fossil fuel developers as of September 2022 and only a handful of the financial institutions have adopted policies that meaningfully restrict finance to new fossil fuel projects and companies developing new fossil supply projects since joining GFANZ.

The report says that in total, 229 of the world’s largest fossil fuel developers received finance from the 161 GFANZ members covered in this report, which will support them to develop new coal power plants, mines, ports and other infrastructure, as well as new oil and gas fields and pipelines and LNG terminals.

The report warns that these new fossil fuel projects are incompatible with the objective of limiting global warming to 1.5°C, as confirmed in the latest International Energy Agency’s World Energy Outlook, published in October 2022. They will lock in greenhouse gas emissions for decades, despite the adoption of decarbonisation targets by some GFANZ members.

“The science is very clear: we need to stop developing new coal, oil and gas projects as soon as possible if we want to meet our climate goals and avoid a worst-case scenario. Yet, it is business as usual for most banks and investors who continue to support fossil fuel developers without any restrictions, despite their high-profile commitments to carbon neutrality. Their greenwashing is all the more damaging as it casts doubt on the sincerity of all net zero commitments and undermines the efforts of those who are truly acting for the climate,” says Lucie Pinson, Executive Director and founder of Reclaim Finance.

The report castigates the financial giants saying that even though ending finance for fossil fuel expansion is clearly essential to meet the GFANZ commitment to keeping warming under 1.5°C, none of its member alliances have language that meaningfully addresses the issue in their guidelines.

The UN Race to Zero campaign, of which all financial institutions became signatories when joining GFANZ alliances, sets criteria for net-zero aligned financial institutions and other non-state actors. Since June 2022, these criteria have included an end to financing of new fossil fuel projects. While GFANZ has stopped demanding that its members join the UN Race to Zero initiative, the sectoral alliances remain Race to Zero partners and so committed to complying with its criteria.

The NGOs say that the November 2022 report of the UN’s High Level Expert Group on net zero has highlighted that credible net zero pledges must include an end to financial support for fossil fuel expansion. “GFANZ members are acting as climate arsonists. They’ve pledged to achieve net zero but are continuing to pour hundreds of billions of dollars into fossil fuel developers. GFANZ and its member alliances will only be credible once they up their game and insist that their members help bring a rapid end to the era of coal, oil and fossil gas expansion,” says Reclaim Finance Senior Analyst Paddy McCully.

In Japan, Mitsubishi UFJ Financial has approved 154 transactions that have directly provided and facilitated USD 22.7 billion in capital to 57 fossil fuel developers since joining NZBA in June 2021. Nomura Asset Management held USD 7.6 billion in fossil fuel developers as of September 2022.

“Despite their high profile commitments to net zero, Japanese banks and investors, including Mitsubishi UFJ and Nomura Asset Management, are continuing to support the development of oil, gas and even coal through their investments and loans. The Japanese finance sector cannot be taken seriously on the climate crisis until it stops investing in new fossil fuel projects. We need an urgent transition to a green economy for all of us to thrive and the finance sector must help deliver that,” says Eri Watanabe, Senior Finance Campaigner of says.



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