🏦 Unpacking the Greenlash: The Banks Edition

Hi, and welcome to your climate data briefing.

The backlash against green policies—the so-called ‘greenlash’—emerged in 2024 and may be gaining momentum.

How much is signal, and how much is noise?

In the coming briefings, we’ll explore it through various lenses—financial, legal, political, and corporate among them.

Each briefing starts with a single datapoint that could signal a greenlash and then zooms out to the broader picture.  

Today, we focus on the banks.  

Let’s begin.

The Story: Banks Are Leaving the NZBA

Background:

• The Net Zero Banking Alliance (NZBA) commits banks to aligning their lending and investment portfolios with a net-zero target by 2050.
• In 2021, banks rushed to join, bringing over 40% of global banking assets under its umbrella.
• This year, the tide has turned. In January, six American banks withdrew, followed by six Canadian banks. Last week, Macquarie Bank became the first Australian bank to exit.
• Together, these 13 banks accounted for roughly 29% of the alliance’s assets.

Why It Matters

Capital allocation is a key lever in global decarbonisation. Banks influence the shift by steering money away from high-emission industries and toward lower-emission ones.

Tracking Their Promises: Who Delivered?

We examined how these banks behaved over the past four years and whether they lived up to their promises.

In particular, NZBA members committed to disclosing absolute financed emissions in their portfolios. That is, the total amount of greenhouse gas emissions associated with their loans and investments.

We reviewed the disclosures of the 13 banks that withdrew to see if they upheld this pledge of transparency.

Bank of America and Morgan Stanley were among the most transparent banks. Here's the data showing their financed emissions for key sectors:

At the other end of the scale, here’s what we found on financed emissions for Goldman Sachs and Canada’s BMO Financial Group (Bank of Montreal and subsidiaries).

You get the picture.

 The rest—including Macquarie—landed somewhere in between.

The Bigger Picture: Why Did They Leave?

The timing aligns with President Trump’s return to office—hardly a coincidence. But these exits aren’t purely political manoeuvring.

In January, the NZBA’s counterpart for fund managers, the Net Zero Asset Managers initiative, suspended its activities and hid its member list after BlackRock quit, citing “legal inquiries from various public officials.”

This points to a more complex picture—where legal challenges fuel a perceived greenlash in finance.

Meanwhile, since the NZBA’s launch in 2021, new legislation has made transparency mandatory. Voluntary commitments are no longer the only driver. Macquarie Bank, for instance, must now comply with Task Force on Climate-Related Financial Disclosures (TCFD) laws.

While all 13 banks may be tarred with the same brush after withdrawing, some have been more transparent than others. We all know that pledges don’t guarantee delivery. Regulation is a stronger enforcer.

What We’re Reading

BOM's annual climate statement

Australia was 1.46°C hotter in 2024 than the 1961-90 average, making it our second hottest year on record (behind 2019). Sea surface temperatures were the warmest on record, 0.89°C above the average. Down in the weeds, atmospheric CO₂ was up 0.7% for the year, 6.4% for the decade, and 52% since 1750 (based on Antarctic ice cores). For methane, that’s 0.4%, 5.8% and 158%. The statement follows BOM’s State of the Climate 2024 report, which described a ‘consistent picture’ of how climate change is interacting with underlying natural variability. (Bureau of Meteorology)

Is outback scrub really saving the planet?
A former cattle station near Bourke bagged nearly $6 million over a decade for soaking up carbon with new trees. But satellite images show no clear growth in vegetation. Forest regeneration projects cover 5% of Australian land and 30% of our carbon credit market. Both major parties’ climate policies ‘rely heavily on offsets’ as a cheap and politically palatable path to meeting obligations. The program has been paused for a refresh, but critics say growing ‘very dry forests in inland Australia’ is a ‘multibillion-dollar scam’ wherein even the minority of successful projects will ‘blow up when we get to a dry period’. (The Age)

Headlines This Week

Plans for a $600 million hydrogen plant at Whyalla shelved as government announces steelworks support package (ABC, 20 Feb)

Sun sets over minimum payments for Victorians with rooftop solar (The Age, 16 Feb)

Growth in global electricity demand is set to accelerate in the coming years as power-hungry sectors expand (International Energy Agency, 14 Feb)

$9b rebound in renewables projects keeps 2030 in sight (Australian Financial Review, 13 Feb)

New studies suggest a key Paris warming target has been breached (The Sydney Morning Herald, 12 Feb)

Data Snapshots

Fuels powering the grid (National Electricity Market on Thursday 20 Feb)

• Coal (Black): 39.1%
• Wind: 16.9 %
• Solar (Rooftop): 15.9 %
• Coal (Brown): 12.8 %
• Solar (Utility): 9.7 %
• Hydro: 4.8 %
• Gas: 1.7 %

Summary:

• Fossil fuels: 53.7%
• Renewables: 47.4%

Visit the Energy Dashboard

Final Thought

“Some [alliances] have a sunset clause and others like zombies persist even though they’re not very useful.”
— Ben Caldecot

That's your climate data briefing for this week. We'd love to hear your feedback, if you have any. Thanks for reading and see you again soon.

💛 Juliette and the OnlyFacts team.

ps. Keen to see the details? The web version of this newsletter will have interactive charts you can explore in about an hour.