The “courageous” stand that climate advocates hoped for from the world’s senior bankers was ultimately not taken. Instead, a widespread retreat from a key climate commitment has led to the folding of the Net Zero Banking Alliance (NZBA), which has ceased all operations.
The call for courage came from Jeanne Martin of ShareAction, who argued that “senior bankers need to be far more courageous” in the face of political challenges to climate action. This challenge materialized in the form of an “anti-woke” movement in the US following Donald Trump’s re-election.
However, instead of a courageous stand, the industry’s leaders opted for a strategic retreat. The six most powerful US banks, including JPMorgan Chase and Bank of America, chose to abandon the NZBA rather than defend their membership against political attacks.
This lack of courage at the top had a domino effect. With the industry’s leaders in retreat, other international banks saw little reason to hold the line alone. The subsequent departures of major players like HSBC and Barclays were a clear signal that the collective will to fight had evaporated.
While some lament this failure of leadership, others argue it was predictable. Critics of the NZBA suggest that the profit-driven logic of banking is inherently risk-averse, especially to political risks. From this perspective, a “courageous” stand was never a realistic expectation. They contend that the only way to ensure banks act is not to appeal to their courage, but to mandate their compliance through regulation.