JPMorgan pulls fossil fuel support

By Lachlan Maddock
 — 1 minute read

JPMorgan Chase has ended its support for the coal-mining industry and set aside hundreds of billions to support climate action in the latest high-profile divestment from fossil fuels.

JPMorgan will be expanding restrictions on financing for coal mining and coal-fired power, as well as prohibiting financing for new oil and gas development in the Arctic. The investment bank will also become a member of pressure group Climate Action 100+, joining the likes of global asset manager BlackRock. 

“This announcement is a long-awaited signal that JP Morgan Chase may be ending its outsized level of fossil fuel financing in the face of growing climate concern,” said Danielle Fugere, president of corporate social responsibility group As You Sow. 


“This first step is significant. Funding of new coal, including coal-fired power plants, is incompatible with the goal of maintaining global temperature rises at 1.5 degrees Celsius.”

JPMorgan has also committed to facilitating $200 billion to advance the objectives of the UN Sustainable Development Goals. That money will be used to address broader challenges in both the developing and developed world, including supporting clean water and waste management and advancing infrastructure.

The bank is using $50 billion of that to address its 2017 clean financing goal, and hopes that it will be able to source renewable energy for 100 per cent of its global power needs by 2020. 

“Overall, investors applaud JPMorgan’s announcements,” Ms Fugere said.

“As climate change increasingly impacts the economy, investors are asking their companies to take greater responsibility for transitioning their businesses to thrive in a low-carbon economy. JPMorgan Chase is a lynchpin in that transition. Having taken this first important step, investors are looking to JPMorgan to rapidly transition the full range of its fossil fuel financing, including oil and gas, in line with Paris goals.”

BlackRock made headlines in January after deciding to end its active investments in companies that derive more than 25 per cent of their income from thermal coal. While the asset manager continued to provide exposure to fossil fuels through its passively managed index funds, it also introduced screens to help investors limit their exposure. 

“Given JPMorgan itself has warned of the unacceptable risks associated with a warming climate, we are pleased to see the company take this important step,” said Lila Holzman, energy program manager of As You Sow.

“JPMorgan’s outsized impact on the climate crisis enables it to position itself as a leader in this space. As BlackRock and other financial institutions are beginning to step up to the climate challenge, we hope such signals will spur a fundamental transition to a Paris-aligned economy.”


JPMorgan pulls fossil fuel support
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