JP Morgan’s announcement comes amid a flurry of billion- and trillion-dollar commitments by banks toward ESG initiatives - a sign that Wall Street is betting the solutions to climate change and inequality will come from corporations. These targets are being issued as sustainable finance investors and industry insiders mull whether regulators should make it more expensive for banks to lend to fossil fuel companies. A recent UK survey found widespread support for a proposal that would impose tougher rules around the amount of capital banks need to hold if they lend to companies responsible for emitting high levels of greenhouse gases.
JP Morgan is among the leading US lenders to fossil fuel companies, having provided USD 317 billion of lending and underwriting since 2016, according to a recent study by environmental activist group Rainforest Action network. Growing investor interest in ESG issues has pushed several global banks to set their own net-zero carbon emissions targets and to stop funding coal and Arctic drilling projects, in addition to setting targets like these.
JP Morgan pledged to share more details about its ESG initiatives, including its work establishing emission targets for companies in its financing portfolio, in its next climate report, due out this spring (2021).
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