Dive Brief:
- Goldman Sachs has quit the United Nations-backed Net-Zero Banking Alliance — a sector coalition whose members have committed to aligning their financial activities with the aim of reaching net-zero emissions by 2050 — the investment bank confirmed to ESG Dive on Monday.
- “We have the capabilities to achieve our goals and to support the sustainability objectives of our clients,” a Goldman spokesperson said in an emailed statement. “Goldman Sachs is also very focused on the increasingly elevated sustainability standards and reporting requirements imposed by regulators around the world.”
- Though the New York-based bank did not provide an explicit reason for its exit, the decision comes as the NZBA and other climate-focused alliances face increased scrutiny from the Republican party, which has initiated probes on ESG policies across multiple fronts.
Dive Insight:
Goldman made “significant progress in recent years” on its net-zero goals and aims to make further progress by “expanding to additional sectors in the coming months,” the spokesperson told ESG Dive.
“Our priorities remain to help our clients achieve their sustainability goals and to measure and report on our progress,” the spokesperson added.
The bank’s departure from NZBA, first reported by Reuters on Friday, comes shortly after it departed Climate Action 100+ in August, joining several other high-profile financial institutions that exited the investor engagement group earlier this year amid heightened scrutiny surrounding ESG and climate initiatives. JPMorgan Asset Management and State Street Global Advisors announced they were departing CA100+ in February, while BlackRock said it was downgrading its membership to a smaller international arm.
At the time, Goldman told ESG Dive it has made investments in its “ability to meet the sustainable investing needs of [its] clients” and remains dedicated to “leveraging [its] global capabilities.”
The Net-Zero Banking Alliance — whose members have committed to align their lending, investment and capital markets activities with global efforts to tackle climate change — has been the target of several GOP-led probes and investigations of late.
Earlier this year, the Republican heads of agriculture from 12 states, including Alabama, Georgia, Florida and Texas, requested information from NZBA members on their plans to achieve net-zero status within their respective agricultural portfolios.
The request was sent to the heads of Goldman Sachs, Bank of America, Citigroup, JPMorgan Chase, Morgan Stanley and Wells Fargo, who were asked to confirm their respective banks’ NZBA member status and disclose any involvement the United Nations Environment Programme had had in guiding or reviewing the banks’ agricultural climate targets, according to the Jan. 29 letters.
At the time, the agriculture commissioners said they had “serious concerns” about the potential impacts of the banks’ net-zero goals on the agriculture sector, especially the effects on food availability and credit access for farmers and agriculture product manufacturers.
Prior to this, 14 Republican state attorneys general began an investigation into the Net-Zero Banking Alliance in the fall of 2022, probing climate pledges by those signatories on allegations the banks blocked credit to oil companies.
The attorneys general sent civil investigative demands to Goldman, JPMorgan Chase, Bank of America, Citi, Wells Fargo, Goldman Sachs and Morgan Stanley asking for information about their participation in the NZBA.
