Thursday, March 18, 2021
More and more banks and fossil fuel companies are releasing plans to align their financial operations with the Paris Agreement, and announcing ‘Net Zero by 2050’ commitments. Large financial sector players like Barclays, Banco Santander, Morgan Stanley, JPMorgan Chase, HSBC, TD Bank and Bank of America , and fossil fuel companies including Shell, BP and RWE have recently announced Net Zero and carbon neutrality commitments.
We expect many more of these announcements from both financial institutions and fossil fuel companies in the runup to COP26, the 5th anniversary of the signing of the Paris climate agreement, to be held in Glasgow in November. This is certainly encouraging and shows that climate action is gaining momentum. But the flurry of announcements also diverts attention from what is actually happening in practice, with an imminent risk of ‘greenwashing’ as big businesses bluff the public in to thinking they are taking meaningful action.
Moving to Net Zero will require significant changes in current business practices, and this is where the exploitation of loopholes come in. Here are 9 loopholes in the Paris/Net Zero announcements of banks and fossil fuel companies to look out for:
As a result of these 9 loopholes, commitments by financial institutions and fossil fuel companies that claim to be on a Paris-aligned pathway actually risk a dangerous postponement of the transition to Net Zero. Climate scientist, Dr Jonathon Foley puts it well when he highlights what he calls predatory delay:
“Net Zero commitments can be used by polluting industries to make it appear they are working on climate change, without actually reducing their emissions at all. And that’s a distraction we cannot afford. It’s the ultimate climate fig leaf, and is a form of “predatory delay” — an attempt to keep stalling meaningful climate action a few more years, while still raking in giant profits. And big polluters have mastered the art of predatory delay. Be on the lookout for it.”
Banks and businesses can’t keep kicking the can down the road to avoid taking climate action. Their Net Zero commitments need to be backed up with real Net Zero practices. #NoMoreEmptyPromises
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