Barclays Joins Wall Street-Led Exodus From Net-Zero Alliance

Last month, HSBC became the first major European bank to pull out of the UN-sponsored alliance.

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London-headquartered Barclays has announced it is withdrawing from the industry’s largest net-zero alliance, following the departure of some of the world’s largest banks.

“After consideration, we have decided to withdraw from the Net Zero Banking Alliance,” the British bank said in a statement on Friday.

The UN-sponsored initiative was set up in 2021 by former Bank of Canada Governor Mark Carney to encourage financial institutions to limit the environmental footprint of their operations and push toward achieving net-zero emissions by 2050, with members required to set five-year goals for reducing the financed emissions from high-carbon sectors.

Last month, British HSBC became the first major European bank to exit the alliance. Before it, several major Wall Street also stepped down, among them Goldman Sachs, JPMorgan, Bank of America, Morgan Stanley, Citigroup, Wells Fargo, and Canada’s six biggest banks. The alliance currently counts 126 banks across 44 countries, down from 144 banks in October 2024, according to its website.

In its Friday statement, Barclays argued that the alliance “no longer has the membership to support our transition.”

In an interview a day before Barclays’ announcement, Standard Chartered’s CEO Bill Winters condemned its rival banks for dropping out: “People that said a lot of stuff, but [when] it was fashionable to say it, [and] who are saying either nothing or the opposite now: shame on them.”

He added that its clients “haven’t backed away at all” from their climate goals, despite anti-climate taking hold particularly in the US in recent months. “A lot of these projects just make sense economically,” Winters added. “Most continue to honour the obligations that they made to their shareholders or other stakeholders early on, independent of political noise one way or the other,” he said.

Barclays – like all other institutions that have withdrawn the alliance – said it remained committed to its net-zero goal. “We continue to work with our clients on their transition, finance the transition and scale climate tech, while helping to ensure energy security for our customers and clients,” it said in the statement.

However, analysts say the recent exits send a clear signal to the market that climate change has become even less of a priority for financial institutions.

Following the first wave of high-profile exits, NZBA in April announced it was shifting its strategy from target setting to providing financial support for the energy transition, and was no longer requiring its signatories to align their portfolios to the 1.5C global warming target set out in the Paris Agreement.

In a statement, the alliance said it “remains focused on delivering on the future vision overwhelmingly endorsed by member banks a few months ago.”

“As the largest global initiative specifically focused on supporting climate mitigation action by banks, NZBA is uniquely positioned to provide the practical support banks need to grasp the opportunities and manage the risks of the move to net zero,” it added.

Featured image: Wikimedia Commons.