The shutdown of the Net Zero Banking Alliance (NZBA) is raising tough questions about corporate responsibility in the climate era. The global banking group has ceased operations after a mass exodus of members, a move that many are interpreting as a retreat from responsibility in the face of political pressure.
The pressure began in the United States following the re-election of Donald Trump. His administration’s hostility towards environmental regulations fostered an “anti-woke” climate that made it difficult for banks to publicly maintain their climate commitments without facing political backlash.
The first sign of this retreat was the coordinated withdrawal of the six largest US banks. Institutions like Goldman Sachs and Citigroup chose to abandon the global alliance, a decision widely seen as prioritizing political self-preservation over their stated climate goals. This move critically undermined the entire initiative.
The retreat then went global. With the American banks gone, European and Japanese lenders followed suit, leading to the eventual departure of UK giants HSBC and Barclays. The alliance, once a symbol of collective action, became a symbol of collective retreat.
This has left a sour taste in the mouths of many climate advocates. Jeanne Martin of ShareAction called the shutdown “bitterly disappointing” and urged bankers to be “far more courageous.” However, critics like Reclaim Finance argue that relying on the voluntary responsibility of banks was always a flawed strategy. For them, the real responsibility lies with governments to create a regulatory framework that forces the financial sector to act.
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