Private banks around the world, including all of Canada’s “Big Five”, are ramping up their fossil fuel investment and “backsliding” on the goals of the Paris agreement, according to the latest in a series of annual investment report cards published last week by nine major environmental organizations.
Fossil investment by the 36 banks increased 11% last year, from US$104 to $115 billion, the report found. Tar sands/oil sands investment grew a mind-bending 111%, from $22 to $46 billion, with the Royal Bank of Canada leading the way.
The three banks with the fastest-growing fossil portfolios were JP Morgan Chase, RBC, and TD Bank, the U.S. Sierra Club reports.
“According to the report’s key data,” writes editorial fellow Katherine Wei, “large Chinese banks and some European banks have reduced their financing in tar sands, but the reduction fell short compared to the massive increases from Canadian and U.S. banks.”
Overall, “the report points out how very few banks are aligning their business plans with the 2015 Paris climate agreement, whose temperature goals require banks to cease financing expansion of the fossil fuel sector.”
While “banks voice their support for climate action and the Paris climate agreement,” said Ben Cushing of Sierra’s Beyond Dirty Fuel campaign, they “funnel money into the fossil fuel industry at the same time.”
The report did point to a 17% reduction in bank financing for Arctic and deepwater fossil operations. And in the last year, French bank BNP Paribas has introduced “restrictions for coal financing and some parts of oil and gas, as well.”
These changes in practice owe at least something to public pressure, Cushing said. “People are realizing that they have the ability to hold these banks accountable for investing in extreme fossil fuels.”
“The financial industry is on notice,” added Honor the Earth National Campaigns Director Tara Houska. “The human rights policies banks claim [are] in place must be enforced.”