Barclays has become the second major bank to leave the Net Zero Banking Alliance (NZBA) in less than a month, as a ‘climate-climbdown’ in the financial services sector continues.
The NZBA, which is bank-led and UN-convened, represents major global banks committed to aligning their lending, investment, and capital market activities with net-zero greenhouse gas emissions by 2050. The Alliance, which was founded in 2021, has more than 120 members from 44 countries, collectively managing $42 trillion in assets[i].
In a statement Barclays explained that their decision related to recent membership losses: “After consideration, we have decided to withdraw from the Net Zero Banking Alliance. With the departure of most of the global banks, the organisation no longer has the membership to support our transition”[ii]
They added that: “We are committed to our ambition to be a net zero bank by 2050. Our targets to mobilise $1trillion of Sustainable and Transition Financing and for financed emissions remain unchanged. We continue to work with our clients on their transition, finance the transition and scale climate tech, while helping to ensure energy security for our customers and clients. This is an important commercial opportunity for Barclays; in 2024, we generated approximately half a billion pounds in revenues from sustainable and transition-related activity.”[iii]
In response a spokesperson for the NZBA has said that the group remains focused on delivering its future vision, adding that the coalition is “supporting its members to lead on climate by addressing the barriers preventing their clients from investing in the net-zero transition”.
Earlier this year NZBA members ‘overwhelmingly’ voted to drop the coalition's 1.5-degree alignment, as well as a watering down of wider climate goals. It means that banks should now aim to limit global warming to well below 2 degrees, and instead ‘strive’ for 1.5 degrees. The previous NZBA requirements set this target as 1.5 degrees, with no mention of a 2-degree limit.
The NZBA says that it acknowledges a wider range of net-zero pathways that align with the temperature goals of the Paris Agreement. They add that this increases flexibility for banks with exposures to a range of markets and sectors to manage targets and transition across their balance sheet. In addition, the changes mean that broader climate requirements have effectively been converted into non-binding “best practice” guidance.
Barclays decision to exit the NZBA follows the loss of HSBC last month, where the latter firm became the first major UK bank to leave the climate coalition. It follows a wave of departures in recent months, including the exit of all six of the largest US banks – JP Morgan, Citigroup, Bank of America, Morgan Stanley, Wells Fargo, and Goldman Sachs.
In a press release dated 11th July HSBC said: “In 2020, HSBC was one of the first global banks to set a net zero by 2050 ambition. We remain resolute in this long-term ambition and in supporting our customers to finance their transition objectives. We believe supporting our customers’ transition brings benefits to their businesses, helps generate long-term financial results for our shareholders, and contributes to making the global economy more resilient”[iv].
HSBC added that the NZBA had played a crucial role in developing guiding frameworks to help banks establish their initial target-setting approach, and: “With this foundation in place, and as we work towards updating and implementing our Net Zero Transition Plan later in 2025, we, like many of our global peers, have decided to withdraw from the NZBA. We continue to remain engaged with the Glasgow Financial Alliance for Net Zero to support the mobilisation of capital towards the net zero transition”[v].
[i] Members – United Nations Environment – Finance Initiative
[ii] Statement on the Net Zero Banking Alliance
[iii] Ibid
[iv] Statement on the Net Zero Banking Alliance | HSBC news | HSBC
[v] Ibid
Lauren has extensive experience as an analyst and market researcher in the digital technology and travel sectors. She has a background in researching and forecasting emerging technologies, with a particular passion for the Videogames and eSports industries. She joined the Critical Information Group as Head of Reports and Market Research at GRC World Forums, and leads the content and data research team at the Zero Carbon Academy. “What drew me to the academy is the opportunity to add content and commentary around sustainability across a wealth of industries and sectors.”
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