The Net Zero Banking Alliance (NZBA) has proposed transforming itself into a “framework” initiative that provides guidance to banks from a membership-based alliance.
The NZBA introduced greater flexibility for members earlier this year, following the departure of several major US banks. Their exit has been followed by a series of high-profile withdrawals, with Barclays and UBS among the most recent to quit.
In a statement, the NZBA’s steering group said the new model was the most appropriate to help banks remain resilient and accelerate the real economy transition, “as well as to continue engagement with the global banking industry to develop further guidance and tools needed to support them and their clients”.
The NZBA has suspended its activities pending a member vote, the results of which will be released at the end of September.
The body reaffirmed its commitment to supporting banks’ efforts to address the impacts of climate change and encouraged the banking sector to “remain steadfast” in implementing their net zero commitments.
“Voluntary alliances like NZBA did not deliver. Fossil fuel finance needs effective regulation, which would also improve the financial system’s resilience. Central banks, bank regulators and oversight agencies should finally step up to the plate. They should start by drawing a clear line at the financing of fossil fuel expansion,” said Katrin Ganswindt, Head of Financial Research at Urgewald, a non-profit environmental and human rights organisation.
