A global alliance of banks committed to net-zero emissions has sunk under the weight of political backlash. The Net Zero Banking Alliance (NZBA) confirmed its immediate shutdown after a torrent of departures, triggered by a hostile political climate in the United States, left the organization without the critical mass needed to operate.
The trouble began with the re-election of Donald Trump, whose administration promised to wage war on environmental regulations. This emboldened a powerful “anti-woke” movement that targeted corporations for their climate and social policies. American banks in the NZBA quickly found themselves in the political crosshairs.
In a move of collective self-preservation, the six largest US banks abandoned the alliance. This included financial titans like JPMorgan Chase and Goldman Sachs, whose exit gutted the NZBA of its most powerful members and sent a chilling message about the risks of corporate climate advocacy in the current political environment.
The American withdrawal destabilized the entire global coalition. Without the participation of Wall Street, the alliance lost much of its clout. Banks in other parts of the world, from Europe to Japan, began to see membership as pointless, leading to a steady stream of further departures, including, most recently, from Britain’s HSBC and Barclays.
The shutdown has been met with both dismay and a sense of vindication. Groups like ShareAction view it as a “bitterly disappointing” failure of corporate courage. But others, such as Reclaim Finance, argue the NZBA was a flawed concept from the start, a “doomed” vehicle for greenwashing. They insist its demise proves that the financial sector will not act on its own and must be compelled to do so by robust government regulation.