UN-Convened Net Zero Banking Alliance
Industry-led and UN-convened, the Net Zero Banking Alliance (NZBA) is a group of leading global banks committed to financing ambitious climate action to transition the real economy to net-zero greenhouse gas emissions by 2050. NZBA’s framework, guidance, and peer learning opportunities support members to design, set, and achieve credible science-based net zero targets for 2030 or sooner that deliver value for their investors, clients, and customers. NZBA is the climate accelerator for UNEP FI’s Principles for Responsible Banking (PRB) and the sector-specific alliance for banks under the Glasgow Financial Alliance for Net Zero (GFANZ).
NZBA member banks sign a Commitment Statement and pledged to follow the target setting and reporting processes outlined there and in the accompanying Guidelines for Climate Target Setting for Banks.
All banks that have signed the commitment will: (1) Transition the operational and attributable greenhouse gas (GHG) emissions from their lending and investment portfolios to align with pathways to net-zero by 2050 or sooner. (2) Within 18 months of joining, set targets for 2030 or sooner and a 2050 target, with intermediary targets to be set every 5 years from 2030 onwards. (3) Banks’ first 2030 targets will focus on priority sectors where the bank can have the most significant impact, ie. the most GHG-intensive sectors within their portfolios, with further sector targets to be set within 36 months. (4) Annually publish absolute emissions and emissions intensity in line with best practice and within a year of setting targets, disclose progress against a board-level reviewed transition strategy setting out proposed actions and climate-related sectoral policies. (5) Take a robust approach to the role of offsets in transition plans.
The commitment is underpinned by the bank-led UNEP FI Guidelines for Climate Target Setting for Banks. They outline four principles for target-setting: (1) Banks shall set and publicly disclose long-term and intermediate targets to support meeting the temperature goals of the Paris Agreement. (2) Banks shall establish an emissions baseline and annually measure and report the emissions profile of their lending portfolios and investment activities. (3) Banks shall use widely accepted science-based decarbonisation scenarios to set both long-term and intermediate targets that are aligned with the temperature goals of the Paris Agreement. (4) Banks shall regularly review targets to ensure consistency with current climate science. (5) Consult the Intermediate Target Disclosure Checklist to ensure your bank’s intermediate targets meet the criteria set out above and review the Supporting Notes for the guidelines for additional clarification on target-setting.
