The Commonwealth Bank’s latest statement on climate change fails to meet the bank’s previous commitment to the Paris Agreement, says Market Forces.
CBA released its first 'Climate Policy Position Statement' yesterday as part of its annual report, in which the bank committed to both decrease the intensity of its business lending and reduce its own emissions.
However, according to environmental financial group Market Forces, CBA has failed to honour its previous commitment to the Paris Agreement goal to limit global warming to 2 degrees.
Market Forces executive director Julien Vincent said CBA’s position statement demonstrated they were “not even pretending” to make an effort.
“Unlike the bank’s peers in Australia and overseas that are taking concrete steps to avoid the most carbon intensive sectors, Commonwealth Bank clearly lacks either the interest or competency to fulfil its commitment to help hold global warming below two degrees,” Mr Vincent said.
According to CBA’s position statement, the bank would “target an average emissions intensity decrease of our business lending portfolio consistent with our commitment to a net zero emissions economy by 2050”.
However, the Market Forces analysis suggested this statement was vague and lacking in detail.
“The wording of this statement is very concerning as it is aspirational but no hard targets are being set,” the analysis said.
“It also covers the bank’s entire business lending, leaving room for some sectors to increase while others decrease. It is also a target that could conceivably be met by adding more renewable energy to energy portfolios (which is of course positive) but not necessarily requiring reductions on exposure to fossil fuels.
“This offers no confidence whatsoever that Commonwealth will reduce its fossil fuel exposure.”
Mr Vincent said the policy statement left “the door wide open” to continue lending to fossil fuel projects.
“That in itself should be enough to conclude this flimsy document has no relationship with the goal of holding global warming to less than 2 degrees,” Mr Vincent said.
The analysis also compared CBA’s commitments in renewable energy lending with its peers and found it to be “a slightly lower commitment pro rata than those of the other major banks”.
In light of what Market Forces called a "dismal" position statement, the environmental group has declared its intention to lodge a shareholder resolution against the bank.
Stimulate new ideas. Stimulate new thinking. Top up your CPD and hear from industry experts with InvestorDaily’s Knowledge Centre. Keep up to date with the latest trends and reforms, all while adding to your CPD. Explore the knowledge centre Knowledge Centre now.
Despite the Australian economy’s ongoing rapid recovery, an Australian equity head believes GDP growth will “fade” in 2022. ...