Industry-led and and UN-convened Net-Zero Banking Alliance (NZBA), o-launched by the UNEP Finance Initiative and the Financial Services Taskforce of the Sustainable Markets Initiative (SMI), is the newest net zero alliance and is the banking tool of the Glasgow Financial Alliance for Zero Net Emissions (GFANZ).
GFANZ brings together over 160 firms (together responsible for assets in excess of $70 trillion1) from the leading net zero initiatives across the financial system to accelerate the transition to net zero emissions by 2050 at the latest. It will seek to mobilize trillions of dollars needed to build a zero-emissions global economy and deliver he goals of the Paris Agreement. It will also provide a forum for strategic coordination among the leadership of financial sector institutions to accelerate the transition to a net zero-emissions economy.
NZBA comprises an initial cohort of 43 of the world’s leading banks in 23 countries with US$ 28.5 trillion in assets, with a focus on delivering the banking sector’s ambition to align its climate commitments with the Paris Agreement goals, with collaboration, rigour, and transparency. These banks are committed to aligning theiroperational and attributable emissions from their lending and investment portfolios with pathways to net-zero by 2050 or sooner. Within 18 months of joining, banks will set 2030 targets (or sooner) and a 2050 target, with intermediate targets to be set every 5 years from 2030 onwards. All targets will be regularly reviewed to ensure consistency with the latest science (as detailed in IPCC assessment reports). Banks’ first 2030 targets will focus on priority sectors where the bank can have the most significant impact, ie. the most GHG-intensive sectors within their portfolios.
This Alliance seeks to strengthen, accelerate and support the implementation of decarbonization strategies, providing an internationally consistent framework and guidelines supported by peer-to-peer learning of pioneering banks. It recognizes the vital role of banks in supporting the global transition from the real economy to net zero emissions.
These alliances will shortly be joined by some of the world’s leading insurers and reinsurers in the soon-to-be launched UN-convened Net-Zero Insurance Alliance (NZIA).