“Big banks finance more emissions than Italy, Germany, Uk and France combined”
Despite accounting for only 6 percent of the loans of the G7 countries' largest banks, CO2-intensive sectors linked mainly to fossil fuels are responsible for more than half of the total emissions financed by the banks themselves.
That's the message delivered on the eve of the G7 Finance Summit in Stresa by ReCommon (an association that campaigns against fossil fuels) in releasing its report “Unsupervised, the carbon pollution of the world's largest banks” yesterday, May 21 (link below). The document, more broadly, reveals how the largest global banks are responsible for more greenhouse gas emissions than Italy, Germany, the UK and France combined.
Emissions associated with 29 major banks amount to 2.7 billion tons in 2022, compared to 2 billion for the four countries taken as a benchmark.
The figure was derived based on information available at the end of 2022, but according to ReCommon analysts it would be calculated “largely by default” due to a lack of transparency and poor disclosure practices by lending institutions. In particular, the study denounces how most banks do not make absolute emissions data public but only provide “intensity metrics ”calculated on secondary parameters, such as the enterprise value of the financed company or the total value invested in the company.
“If the most important banks on the Planet were a country, they would be among the top global polluters,” Daniela Finamore, co-author of the report, says in a note, which makes an appeal to finance ministers ahead of the meeting: “They need to stop the financing of fossil fuels and direct it with the public interest as a goal, so that we can all live in a safer climate and a stable economy.”
Among those most involved in the fossil business is Intesa Sanpaolo, which has supported the sector with $81.6 billion since the Paris Agreement. In the past year it has allocated $8.6 billion in investments and $7.5 billion in financing.
Intesa Sanpaolo's share of the investment portfolio, which could be analyzed based on transparent data provided by the bank itself, is 5 percent. Mizuho, the third largest financial services company in Japan, has the highest share at 60 percent. At the bottom are giants such as JP Morgan, Barclays and ING: in these cases, all exposure assessed for GHG emissions was done using external input-output data sets.
