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Friday, February 4, 2022

Climate First Bank joins Net-Zero Banking Alliance

Climate First Bank, which opened its flagship location in St. Petersburg, Fla., in June 2021, followed by a branch in Orlando in October 2021, joined the Net-Zero Banking Alliance. The fledgling organization was forged during the 2021 United Nations Climate Change Conference (COP26) held last fall in Glasgow, Scotland.

The aim of COP26 was to further initiatives aimed at protecting the earth's fragile ecosystem. Resulting initiatives, led by the United Nations Framework Convention on Climate Change and subcommittees, ranged from climate adaptation financing, transparent reporting and a global implementation strategy, UN Secretary-General António Guterres stated.

Noting that 760 million people lack access to electricity and 2.6 billion lack clean cooking solutions, Guterres urged attendees to solve these challenges. "With the global roadmap at hand, we can together realize the potential of energy as a crucial enabler for the achievement of the [sustainable development goals] and the objectives of the Paris Agreement, ensuring a more prosperous, equitable and sustainable future for people and the planet," he said.

Philipp Aeby, CEO of RepRisk, pointed out that transparent reporting is a critical tool for investors focused on sustainable capital allocation. "Being transparent enables our clients to make better informed decisions – and it's the right thing to do," he said. "As a pioneer in the ESG data industry, we are excited to see the growth, acceptance, and adoption of ESG data."

Net-Zero Banking Alliance

The Net-Zero Banking Alliance, comprising 98 members from 39 countries collectively managing $66 trillion in assets, committed to fight climate change by supporting net-zero emissions. NZBA members pledged to follow the following guidelines:

  1. Set scenario-based interim targets for 2030 or sooner for priority sectors.

  2. Prioritize areas of most significant impact in greenhouse gas-intensive and emitting sectors.

  3. Annually publish emissions and emissions intensity.

  4. Utilize best available scientific knowledge.

  5. Set first target(s) within 18 months of signing and report annually thereafter.

  6. Disclose progress against a board-level reviewed transition strategy.

Climate First Bank is known as the world's first climate-focused bank. "Climate First Bank is proud to join [the NZBA] alliance and work together with our peers in the finance sector to accelerate action on climate and further our collective goal to reach net-zero emissions by 2050," said the bank's CEO and founder Ken LaRoe. "Banks have a huge part to play in our battle against the climate crisis. Each investment in fossil fuels and other extractive industries is an investment against humanity's future. That's why changing finance to finance change is a huge cornerstone in the plan to save our planet."

LaRoe described Climate First as a values-based community bank that offers simple, easy-to-use banking products, powered by technology, to meet the expectations of today's consumers. In addition to standard banking services, the bank places special emphasis on non-governmental organizations (NGOs) and businesses committed to sustainability, he stated. Eco-conscious customers will find dedicated loan options for solar photovoltaic (PV), energy retrofits and infrastructure to help combat the climate crisis.

Global cooperation

Oliver Griffith, a former World Bank executive and former U.S. diplomat, noted deforestation is a leading contributor to climate change. "To meet the target of limiting temperature rise to 1.5° C, emissions from deforestation must decrease by between 70 to 90 percent by 2030," he said. "A coalition of the willing at COP pledged to do so by 2030 by stopping all deforestation. To get there will take concerted and cooperative action by all stakeholders - governments, the private sector, NGOs, donors, and, most of all, those that live in and off the forests." 

As Griffith noted, 141 nations pledged to fight climate change during COP26 by adopting the following measures:

  1. Conserve forests and terrestrial ecosystems and accelerate restoration.

  2. Facilitate international and domestic trade policies that promote sustainable development and do not drive deforestation and land degradation.

  3. Reduce vulnerability by empowering communities with sustainable agriculture, and recognize the rights of Indigenous Peoples.

  4. Implement sustainable agricultural policies to promote food security and benefit the environment.

  5. Reaffirm financial commitments and increase finance and public and private sector investment while improving access to sustainable agriculture, forest management, conservation and restoration, and support for Indigenous Peoples and local communities. 

  6. Facilitate alignment of financial flows with international goals to reverse forest loss and degradation while ensuring robust policies and systems supporting sustainable land use, biodiversity and climate goals. 
end of article

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