Former Bank of Canada governor Mark Carney’s credibility as a global climate finance leader is under fire as environment lobby groups say he is allowing some of the world’s biggest banks to use him as cover to keep funding fossil fuels.
Carney turned down openings to run for the federal Liberals in last month’s election campaign because of his previous commitment as the United Nations special envoy on climate action and finance, The Canadian Press writes. As part of that role he chairs the Glasgow Financial Alliance for Net Zero (GFANZ), aiming to get the biggest financial institutions around the globe to commit and lead the way to net-zero emissions by 2050.
The alliance is to play a critical role at next month’s UN climate conference, COP 26, where a big focus will be on finding the finances to fund the climate promises to achieve needed reductions in greenhouse gas emissions. But a coalition of more than 90 Canadian and international environment groups published full-page ads last Thursday in the Toronto Star and Financial Times, asking Carney to beef up the membership requirements in the alliance.
“While we applaud your role in establishing frameworks to help green the financial system, too many signatory banks and other financial institutions are using GFANZ and ‘Net Zero’ promises as greenwash, empty promises without meaningful actions or clear accountability,” the ad says in a letter printed beside a giant photo of Carney superimposed on a background of flooding waters, smokestacks, and a sky tinted orange from wildfires.
Carney’s office did not immediately respond to CP’s request for comment.
Richard Brooks, climate finance director at Stand.earth, said membership in the alliance is based on promises by banks and other financial institutions that they will set targets to invest in green energy projects and divest from fossil fuels, but there is no immediate requirement for follow-through.
“The threshold that’s been set is very much, ‘Hey, join the club and then sometime in the future we’ll ask you to make some more commitments about how you’re going to change your practices on this road to get into net-zero emissions by 2050,’” Brooks told CP.
But the science is clear that action cannot be punted down the road, he added. So GFANZ’ membership requirements should be tightened so any financial institution involved has to commit to completely phasing out the financing of all fossil fuel companies and to cut in half the emissions produced by the investments they do make by 2030.
He said any institutions that don’t meet those goals should be kicked out immediately so they can’t use their membership as “green cover” while they squeeze every last drop of profit out of the fossil fuel sector.
“We’ve had way too many years, decades, of talking and talking and not enough acting, and it’s really time to call people on their talk, and force them to walk,” said Brooks.
A statement from the coalition behind the ads said most GFANZ members have not provided any details on how they intend to reduce their fossil fuel investments and have no short-term targets for reducing emissions themselves. Many of them are still among the biggest funders of fossil fuels, the group added, and some have even issued new financing to fossil fuel infrastructure since joining the alliance.
That includes Brookfield Infrastructure, which over the summer moved on its plan to take over Inter Pipeline, the biggest transporter of oilsands bitumen in Alberta. Carney is vice-chair and head of transition investing at a related company, Brookfield Asset Management.
The UN says more than 160 financial firms have signed onto the alliance, but very few are Canadian. There are no Canadian banks among the 43 banking members, and only a handful of asset owners and managers, including the Caisse de dépôt et placement du Québec.
This report by The Canadian Press was first published October 7, 2021.