TORONTO – Bank of Montreal and National Bank have withdrawn from the UN-backed Net-Zero Banking Alliance that aims to accelerate climate action among financial institutions.
The Friday departures follow withdrawals by the six largest banks in the U.S. in recent weeks from the alliance ahead of the presidential inauguration of Donald Trump.
Financial institutions are pulling back following sustained criticism from U.S. Republicans on various climate alliances and the very concept of factoring in environmental risks in their business operations.
On Friday, the U.S. Federal Reserve Board said it had withdrawn from the Network of Central Banks and Supervisors for Greening the Financial System.
BlackRock, the world’s largest asset manager, left the Net Zero Asset Managers Initiative earlier this month in a move that led the group to suspend activities and launch a review of the initiative, citing “recent developments in the U.S.”
BMO did not say why it had left the banking alliance but said it had the capabilities to go it alone.
“We are fully committed to our climate strategy and supporting our clients as their lead partner in the transition to a net zero world,” said spokesman Jeff Roman in a statement.
“We have robust internal capabilities to implement relevant international standards, supporting our climate strategy and meeting regulatory requirements.”
The news comes after BMO chief executive Darryl White hinted at a conference earlier in January that the bank’s days in the alliance were numbered.
At the same conference, RBC chief executive Dave McKay said the alliance was in flux and questioned whether it was the right mechanism to reduce emissions.
National Bank said it left the alliance as it streamlines how it reports on its plans and progress.
“We will continue to have a pragmatic approach and work with companies across all sectors, including large emitters and renewable energy providers, to promote impactful decarbonization strategies,” said spokesman Alexandre Guay in a statement.
“We will continue to play an important role in implementing a responsible environmental, social and economic transition.”
The withdrawal of banks from the alliance shows the need for government to step in, said Greenpeace senior energy strategist Keith Stewart.
“To call this a craven act of cowardice on climate would be too kind,” said Stewart in a statement.
“It does, however, demonstrate that if we want to avoid more communities being burned or flooded in climate-fuelled disasters by moving big money out of fossil fuels and into climate solutions, then we need governments to regulate banks the same way they do smokestacks and tailpipes.”
As of late Friday afternoon, RBC, TD, CIBC, Scotiabank and credit unions including Vancity and Coast Capital were still listed as members.
This report by The Canadian Press was first published Jan. 17, 2025.
Companies in this story: (TSX:BMO; TSX:RY)
