5th February 2024
Banking on a better future
The world – people, animals, plants, birds, economies, agriculture, water supplies etc – is already suffering from the effects of climate change and this is a crisis that will continue to grow (exponentially) unless action is taken. The major contributor of the greenhouse gases cause this, is fossil fuels.
The IPCC AR6 Synthesis Report (2023) states “Limiting human-caused global warming requires net zero CO2 emissions. Cumulative carbon emissions until the time of reaching net-zero CO2 emissions and the level of greenhouse gas emission reductions this decade largely determine whether warming can be limited to 1.5°C or 2°C (high confidence). Projected CO2 emissions from existing fossil fuel infrastructure without additional abatement would exceed the remaining carbon budget for 1.5°C (50%) (high confidence)”. https://www.ipcc.ch/report/ar6/syr/resources/spm-headline-statements/
In other words, our current production levels and use of fossil fuels will, cumulatively (because they build up and remaining in the atmosphere for generations), cause global temperatures rises in excess of 1.5C. (In 2023 the global temperature rise was 1.2C above the average for NASA’s baseline period (1951-1980))
For more insight into the urgency of the situation, see https://www.theguardian.com/environment/2023/mar/20/ipcc-climate-crisis-report-delivers-final-warning-on-15c?CMP=Share_iOSApp_Other
The IPPC’s report goes on to to say “Finance, technology and international cooperation are critical enablers for accelerated climate action. If climate goals are to be achieved, both adaptation and mitigation financing would need to increase many-fold. There is sufficient global capital to close the global investment gaps but there are barriers to redirect capital to climate action.”
Finance is key but it will only be effective if it is targeting projects that reduce emissions. One would expect therefore to be seeing an ongoing g and rapid transfer of money away from fossil fuel projects and into the support of renewable energy. Yet in January 2023 Reuters reported “The share of bank finance going to renewable energy rather than fossil fuels has little changed in six years, raising questions about how fast lenders are pushing energy clients to become greener, according to research published Tuesday. Since 2016 renewable energy has taken 7% of a total $2.5 trillion in bank loans and bond underwriting for energy activities, according to a report commissioned by environmental groups including Sierra Club and Fair Finance International.” https://www.reuters.com/business/sustainable-business/bank-funding-renewables-stagnates-vs-oil-gas-report-2023-01-24/
A report, Banking on Climate Chaos, records that fossil fuel financing from the world’s 60 largest banks reached $5.5 trillion in the six years since the Paris Agreement, 2015, and 2022. Of these JP Morgan, the worst bank overall, financed $39 billion in 2022, so totalling $434 billion between 2016 – 2022. Top rating amongst the European banks was Barclays, which took seventh place in the league table, having $190.5 billion over the time frame.
Barclays provides finance to numerous oil companies including Exxon, Shell, BP, Chevron, Total, and Equinor. This is finance that supports both existing and new projects. Yet there is no space in the world’s carbon budgets for this continuing increase in emissions. “Potential emissions from fossil fuels already in production or under construction – the wells already drills or being drilled – already takes the world well past 2C of global warming… world cannot afford any fossil fuel expansion…” https://www.bankingonclimatechaos.org/
Not surprisingly a number of climate concerned groups are pushing for change – both of banks that they stop financing the fossil fuel industry, and of customers that they stop using these highly destructive banks.
It is often argued that moving one’s money out of Barclays will have no impact as it will merely be replaced by money from elsewhere. I’m not sure that that can always be true – there must at some point be a finite sum of money to be banked. But turning it round, the money you move can then be invested by a greener bank to support renewable energy and other beneficial projects – and this indeed might be money they would otherwise not get. And don’t worry of the amount you are banking with is small: for every £ deposited, banks will lend a multiple amount. Even if that multiplier was only 2 it would double the financial contribution that you money makes to green investments.
Here in the UK Make My Money Matter is calling on individuals to “green their money” as well as encouraging students and alumni to call on their universities to switch to sustainable banks – https://makemymoneymatter.co.uk/
Another useful website is ‘switch it green’ helping people find a better bank – https://www.switchit.green/about
Just Money offers another perspective on the issue, this time from a Christian view point, and has advice and resources for churches and charities wishing to switch to green banking.
I have been involved with Christian Climate Action’s ongoing campaign to encourage charities to switch to greener banks – especially those charities whose remit encompasses people and places adversely affected by the climate crisis. To date Christian Aid, Greenbelt and Oxfam have all declared their decision to switch away from Barclays Bank. Read more on this at – https://www.churchtimes.co.uk/articles/2024/2-february/news/uk/more-charities-sever-ties-with-barclays-over-stance-on-fossil-fuels
And it is not just charities that are being asks to reconsider their banking arrangements. The same ask is being made of churches and dioceses. Christians are called to care for creation and to love their neighbour – which are actually overlapping vocations – and switching to a bank that does not pursue profit through the financing of fossil fuels, is one of the easier steps they can take!
Prayer vigil outside Oxfam’s headquarters.
The Green Tau 