Catenaa, Monday, January 06, 2025 – Bank of America, Citigroup, and Morgan Stanley have announced their departure from the United Nations-backed Net-Zero Banking Alliance (NZBA), following similar exits by Goldman Sachs and Wells Fargo last month.
The is a notable move particularly in the current trend of major institutions moving towards cryptocurrencies as cryptocurencies use large amount of energy in mining. On average, mining 1 BTC consumes around 6,400,000 kilowatt-hours (kWh) of electricity.
The move also shows growing tensions between financial institutions’ climate commitments and political scrutiny in the United States.
The three financial institutions confirmed their withdrawal this week, citing no specific reasons but reaffirming their dedication to achieving net-zero goals independently.
Bank of America and Citigroup pledged to continue collaborating with the Glasgow Financial Alliance for Net Zero (GFANZ), while Morgan Stanley emphasized its focus on advising clients on decarbonization strategies.
The NZBA, a coalition of global banks aiming to align financial operations with net-zero emissions by 2050, has faced mounting pressure from Republican-led probes.
Critics argue that the alliance’s climate pledges impede credit access for fossil fuel industries.
Citi stated its intent to focus on mobilizing capital for emerging markets in the low-carbon transition. Bank of America reiterated its commitment to working with clients on climate-related goals.
Meanwhile, Morgan Stanley emphasized its role in supporting decarbonization in real-world economies.
The departures highlight the challenges voluntary climate coalitions face amid heightened political opposition. Environmental advocates have expressed concern, urging stronger regulatory frameworks to maintain momentum in climate action.
The exits of these financial giants reflect a broader trend of US-based banks stepping away from global climate alliances, raising questions about the future of private-sector leadership in combating climate change.
