LONDON — Former Unilever CEO Paul Polman has blasted some massive banks for placing more cash into polluting industries than into renewable energy.
Speaking to CNBC’s Steve Sedgwick at local weather summit COP26 in Glasgow Tuesday, Polman mentioned: “We still see some of the major banks doing more fossil fuel financing, coal financing than green energy and that’s a big no-no.”
Sixty of the most important banks collectively put $3.8 trillion into fossil gasoline corporations between 2016 and 2020, in accordance with a bunch of local weather organizations named Banking on Climate Chaos 2021.
Polman acknowledged that among the massive banks are shifting towards backing tasks that assist the transition towards zero emissions however mentioned this was financially, not ethically, pushed.
“People are starting to realize that implementing the Sustainable Development Goals — which cost $3 to $5 trillion a year — is significantly less than dealing with these horrendous consequences of inaction. And the financial market is actually the first one to understand that. I don’t think they are moving on moral grounds, I want to be honest there, but they are moving on economic grounds,” he said.
Polman added that the oil and fuel trade must be helped to maneuver towards greener options. “The … high emitting industries that need to transform, we need to help them. I don’t think it serves anything to chastise them … it just doesn’t work. You need to be looking at the challenges that they have, also to reflect a lot of stranding of their assets which are now in the value of these companies and help them in that transition.”
The time period “stranded assets” refers to fossil-fuel associated property resembling coal and oil reserves which are not in a position to make monetary returns because the financial system strikes towards greener energy. Mark Carney, the U.N.’s particular envoy on local weather motion and finance, mentioned monetary markets have to be revamped in order that monetary choices can take local weather change under consideration.
Carney is chairing a coalition of economic corporations named the U.N.’s Glasgow Financial Alliance for Net Zero, which is aiming to hurry up a transition to cleaner energy. Collectively, the banks handle more than $90 trillion of property.
“You now see with the Glasgow pledge that Mark Carney is leading is that we have nearly $100 trillion, which is half the world’s money, saying I want to be net zero in 2050. Can we translate that to 2030 targets which are absolutely key? Can we translate that now into key actions?” Polman said.
Polman’s feedback come as among the massive banks have pledged to spend more on financing carbon discount. Bank of America President Brian Moynihan mentioned Tuesday that the agency will spend $1 trillion towards reaching net-zero emissions by 2050. “To get there, we will provide $150 billion in financing through 2030 over $1 trillion, to the effort,” he mentioned at COP26.
BofA is a part of a activity power referred to as the Sustainable Markets Initiative, which has launched a information for monetary companies corporations to assist their shoppers attain net-zero emissions. Other members embody JPMorgan, Barclays and Credit Suisse.
– CNBC’s Sam Meredith and Catherine Clifford contributed to this report.