Canada’s big banks aren’t doing enough to reduce their carbon footprint and they could be kicked out of the United Nations’ (UN) Net Zero Club, Greenpeace Canada says in a new report released on Wednesday.

In an analysis document entitled Aimed at Goal Zero? The alleged net zero liabilities of Canadian banks, Environmental group urges Canada’s big banks – Royal Bank (RBC), Scotiabank, TD, Bank of Montreal (BMO) and CIBC – to come up with credible and ambitious plans to phase out their support for fossil fuels.

These big five banks are part of the Glasgow Financial Alliance for Net Zero (GFANZ), an initiative to accelerate the decarbonization of the financial sector by 2050, launched just months before the COP26 summit in Glasgow last November. However, they continue to function as the top fossil fuel financiers worldwide, Greenpeace says.

In a report published last spring, we learned that Canada’s big five banks were among the top 20 banks worldwide that provided the most financing to the fossil fuel sector between 2016 and 2021. “It illustrates their hypocrisy and the greenwashing they are involved in,” said Keith Stewart, senior energy strategist at Greenpeace Canada.

Without a solid plan to reduce their emissions, they could be pushed out of GFANZ, which “would damage their credibility and reputation on climate change,” Stewart said.

New terms

Big Canadian banks have little time to adjust. In June, Race To Zero, a United Nations-led standard-setting campaign for GFANZ members, announced stricter new criteria for joining the alliance — including a ban on supporting new coal projects. Existing members have until next June to meet these criteria.

Corresponding FinancialTimes, Race To Zero is reportedly establishing an independent accountability body to which civil society groups can report financial institutions that do not meet the criteria. The body would also have the power to evict financial institutions from GFANZ from 2023.

The UN could announce increased scrutiny to ensure financial institutions meet the new criteria, beginning in September during New York’s climate week and then at the COP27 summit to be held in Egypt in November, again according to Business Daily.

In total, GFANZ has more than 450 financial companies with global assets of 130 trillion US dollars. The initiative is being led by former Bank of Canada Governor Mark Carney, along with former New York City Mayor Michael Bloomberg and former Securities and Exchange Commission (SEC) Chair Mary Schapiro.

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