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bank of america
Morgan Stanley Latest Wall Street Giant to Ditch Net-Zero Coalition
Earlier this week, Bank of America and Citigroup also said they were leaving the Net-Zero Banking Alliance.
Jan 02, 2025
On Thursday, the Wall Street titan Morgan Stanley became the latest financial institution to leave the Net-Zero Banking Alliance, a United Nations-convened group of banks committed to "aligning their lending, investment, and capital markets activities with net-zero greenhouse gas emissions by 2050."
The defections keep piling up. Earlier this week, Bank of America and Citigroup said they were leaving the alliance, and earlier in December Goldman Sachs Group and Wells Fargo announced they were doing the same.
“We will continue to report on our progress as we work towards our 2030 interim financed-emissions targets,” Morgan Stanley toldBloomberg in an email.
While Morgan Stanley didn't offer an explanation for the exit, according to Reuters, financial firms have repeatedly found themselves in the crosshairs of some members of the GOP who argue that corporate efforts to limit fossil fuels run afoul of antitrust law.
Last summer, the Republican members of the House Judiciary Committee published a report accusing financial institutions colluding to impose "radical environmental, social, and governance (ESG) goals on American companies." Their probe was largely focused on another climate group, Climate Action 100+, which is made up of financial institutions who strive to engage companies they invest in on climate issues. That coalition has also experienced a number of defections.
In December, 11 GOP-led states sued three asset managers in federal court, arguing that the firms had "artificially constrained the supply of coal, significantly diminished competition in the markets for coal, increased energy prices for American consumers, and produced cartel-level profits" for the firms in violation of antitrust law.
Despite the stated goals of the Net-Zero Banking Alliance, Morgan Stanley and other firms who are a part of the alliance have remained a major financial life lines for fossil fuel companies.
According to a report published by a group of NGOs in 2023, 56 of the largest banks in the Net-Zero Banking Alliance—including Morgan Stanley—have provided nearly $270 billion in the form of loans and underwriting to more than 100 "major fossil fuel expanders," from Saudi Aramco to ExxonMobil to Shell.
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Wall Street Banks Accused of Trying to Sabotage Key Consumer Protection Rule
"The CFPB must stop this ploy by the biggest banks to keep us trapped under their thumbs."
Nov 15, 2024
Consumer advocates applauded last month as the Consumer Financial Protection Bureau finalized a rule aimed at making it easier for people to switch financial institutions if they're unhappy with a bank's service, without the bank retaining their personal data—but on Thursday, more than a dozen groups warned the CFPB that major Wall Street firms are trying to stop Americans from benefiting from the rule.
Several advocacy groups, led by the Demand Progress Education Fund, wrote to CFPB director Rohit Chopra warning that major banks—including JP Morgan Chase, Bank of America, Citi, TD Bank, and Wells Fargo—sit on the board of the Financial Data Exchange (FDX), which has applied to the bureau for standard-setting body (SSB) status, which would give it authority over what is commonly known as the "open banking rule."
Standard-setting authority for the banks would present a major conflict of interest, said the groups.
The banks are also on the board of the Bank Policy Institute, which promptly filed what the consumer advocates called a "frivolous lawsuit" to block the open banking rule when it was introduced last month, claiming it will keep banks from protecting customer data.
At a panel discussion this week, Bank of America CEO Brian Moynihan also said the open banking rule, by requiring financial firms to unlock a consumer's financial data and transfer it to another provider for free, would cause "chaos" and amplify concerns over fraud.
"The American people are fed up with Wall Street controlling every aspect of their lives and the open banking rule is an opportunity to give all of us some financial freedom."
The groups wrote on Thursday that big banks want to continue to "maintain their dominance by making it unduly difficult for consumers to switch institutions."
"The presence of these organizations on both the FDX and BPI boards undermines the credibility of FDX and presents various concerns relating to conflict of interest, interlocking directorate, and antitrust law," they wrote.
Upon introducing the finalized rule last month, Chopra said the action would "give people more power to get better rates and service on bank accounts, credit cards, and more" and help those who are "stuck in financial products with lousy rates and service."
The coalition of consumer advocacy groups—including Public Citizen, the American Economic Liberties Project, and Americans for Financial Reform—urged Chopra to reject FDX's application for standard-setting authority so long as the banks remain on its board.
“It would be a flagrant conflict of interest for the same banks who are suing to block the open banking rule because it threatens their market dominance to also be in charge of implementing it," said Demand Progress Education Fund corporate power director Emily Peterson-Cassin. "The American people are fed up with Wall Street controlling every aspect of their lives and the open banking rule is an opportunity to give all of us some financial freedom. The CFPB must stop this ploy by the biggest banks to keep us trapped under their thumbs."
The groups called the open banking rule "a historic step forward for the cause of giving consumers true freedom intheir financial lives."
"For this reason, it is imperative that SSB status not be granted to an organization whose board members are, either directly or through a trade association they are participating in, suing the CFPB to stop the rules from taking effect, particularly when such members may be ethically conflicted from such dual participation," said the groups. "By rejecting SSB status for FDX or any other organization with similar conflicts of interest pertaining to Section 1033, the CFPB will help prevent big banks from sabotaging open banking rules."
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Big Banks Have Funded Climate Crisis With Nearly $7 Trillion Since Paris Agreement
"Banks that profit from climate chaos invent new greenwash every year, but we have the receipts that show how much money they put into fossil fuels," said one report author.
May 13, 2024
The world's 60 biggest banks funded fossil fuels to the tune of $6.9 trillion in the eight years following the Paris agreement.
That's the conclusion of the 15th annual Banking on Climate Chaos report, which was published Monday and also found that the financial institutions lavished $705 billion on oil, gas, and coal in 2023—the hottest year on record.
"Financiers and investors of fossil fuels continue to light the flame of the climate crisis," Tom BK Goldtooth, report co-author and executive director of the Indigenous Environmental Network, said in a statement. "Paired with generations of colonialism, the fossil fuel industry and banking institutions' investment in false solutions create unlivable conditions for all living relatives and humanity on Mother Earth."
U.S. financial giants JPMorgan Chase, Citigroup, and Bank of America topped the "dirty dozen" list of the banks that gave the most to fossil fuels since 2016, at $430.9 billion, $396.3 billion, and $333.2 billion respectively. In 2023, U.S. banks provided 30% of total fossil fuel finance, the largest share of any country. JPMorgan also topped the 2023 list at $40.88 billion, with Japanese bank Mizuho Financial overtaking the No. 2 spot with $37.04 billion, and Bank of America remaining in third place with $33.68 billion.
"The science shows that over half of fossil fuels in existing fields and mines must stay underground to limit global warming to 1.5°C, and our Big Oil Reality Check analysis finds that none of the major oil and gas companies we analyze plan to do anything even close to what is needed to hold global warming to 1.5°C," report-co-author David Tong, the global industry campaign manager at Oil Change International, said in a statement. "By injecting a staggering $70[5] billion into fossil fuel financing in 2023 alone, the world's largest banks fund the climate chaos fossil fuel companies wreck on communities worldwide."
The report also tracks how much the financial institutions spent on companies that had fossil fuel expansion plans, according to the Global Oil and Gas Exit List and the Global Coal Exit List. The banks spent $3.3 trillion since 2016 and $347.5 billion in 2023 alone on these companies, or nearly half of total expenditures. Report co-author April Merleaux, research and policy manager at Rainforest Action Network, called the 2023 expansion finance figure "dangerous and inconsistent with real climate commitments."
Overall, Citibank has spent the most on fossil fuel expansion since 2016 at $204 billion, while JPMorgan was the top funder of expansion in 2023 with $19.3 billion.
"As this report is worth nothing if it doesn't turn into action, we call on the banks to finally become fossil free banks, and on the wider climate justice movement to use this data to mobilize for a fossil free banking world."
The researchers also looked at what fossil fuel companies and activities the banks were financing. All told, they considered funding to 4,228 companies. Clients with major expansion plans in 2023 included the pipeline companies Enbridge, TC Energy Corp, and Sempra as well as NextDecade Corp and Rio Grande Valley LNG, which are developing new liquefied natural gas (LNG) export capacity.
Fossil fuel financing did decrease in 2023, down from $778.7 billion in 2022.
"The trend of decreased financing from traditional banks to fossil fuel companies is good news, tempered by the reality that financing for fossil fuel expansion should be zero," the report authors wrote. "But there is little evidence that the decline is driven by voluntary commitments by the banks, especially given the policy rollbacks among major banks."
Indeed, in 2023, Bank of America rolled back commitments to not fund Arctic drilling, thermal coal, or coal-fired plants. Instead, the report authors suggested the downturn in finance was due to external economic and geopolitical factors.
"Unless banks take action to rule out finance for such clients, the decline may not be permanent," they warned.
When it came to the funding of individual high-risk fossil fuel activities, funding for overall expansion, fracking, tar sands, coal- and gas-power plants, and Amazon, Arctic, and deepwater oil and gas all declined. At the same time, funding for metallurgical coal, coal mining, and methane LNG all increased, with LNG funding rising from $116 billion in 2022 to $121 billion in 2023.
"In a year with record climate impacts, I am shocked to see financing for any category of fossil fuels increase. And yet in 2023 this report shows a big increase in financing to companies developing methane gas terminals and related infrastructure," Merleaux said. "Banks should be listening to those on the frontlines and stepping away from these projects."
This year the report—which is a collaboration between Rainforest Action Network; BankTrack; the Center for Energy, Ecology, and Development; Indigenous Environmental Network; Oil Change International; Reclaim Finance; Sierra Club; and Urgewald— features updated methodology that primary sources revealing the role of banks in corporate financial deals. The banks were given a chance to review the data and respond.
"Wall Street's top concern is its profit. Our top concerns are the climate and human rights. Banks that profit from climate chaos invent new greenwash every year, but we have the receipts that show how much money they put into fossil fuels," Merleaux said. "Our new methodology uncovers previously unreported details on banks' support for fossil fuels and gives campaigners new tools to hold them accountable."
Accountability is the report's main goal, according to co-author Diogo Silva, who leads the banks and climate campaign at BankTrack.
"As this report is worth nothing if it doesn't turn into action, we call on the banks to finally become fossil free banks, and on the wider climate justice movement to use this data to mobilize for a fossil free banking world," Silva said. "Later might just be too late. Fossil banks, no thanks!"
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