Canadian banks leave key climate group as US policies and legal pressures reshape global finance
Scotiabank confirmed its departure from the Net-Zero Banking Alliance (NZBA) on Monday, following similar moves by Toronto-Dominion Bank (TD), Bank of Montreal (BMO), Canadian Imperial Bank of Commerce (CIBC), and National Bank of Canada.
These exits come amidst a broader shift in climate-finance commitments by major financial institutions, as reported by BNN Bloomberg.
Despite withdrawing from the alliance, Scotiabank emphasized its continued commitment to decarbonization.
Spokesperson Katie Raskina stated via email that the bank “will continue to finance the transition and support our clients in implementing their sustainability strategies,” adding that the bank will maintain progress reporting and comply with global regulatory requirements.
Royal Bank of Canada (RBC) is now the sole remaining large Canadian bank in the NZBA, though its membership may be under review.
RBC’s CEO, Dave McKay, indicated in January that leaving the alliance would not signal a shift away from net-zero or climate change commitments. RBC did not respond to requests for comment on its membership status.
Canadian banks, including TD, RBC, BMO, and CIBC, ranked among the top 10 financiers of fossil fuel projects in 2024, according to Bloomberg data. JPMorgan Chase & Co. was the largest fossil-fuel financier during the same period.
The NZBA has seen significant defections since December. US financial giants such as Goldman Sachs, Morgan Stanley, Wells Fargo, Bank of America, Citigroup, and JPMorgan Chase have all exited the alliance.
These moves align with US President Donald Trump’s push to roll back climate policies introduced during the Biden administration, as well as Republican efforts to curtail climate finance initiatives through bans and lawsuits.
Other climate initiatives have faced similar challenges. BlackRock Inc. recently left the Net Zero Asset Managers initiative (NZAM), citing exposure to legal inquiries linked to pro-climate strategies.
In 2023, a net-zero alliance for insurers experienced a wave of withdrawals amid Republican litigation threats.
Additionally, Climate Action 100+, a coalition for investors, saw defections from high-profile members such as the asset-management divisions of Goldman Sachs, JPMorgan, and Pacific Investment Management Co.
