A major green banking group is in trouble after Morgan Stanley announced its exit, joining a long list of big banks to leave the group before President-elect Donald Trump takes office.
Morgan Stanley said Thursday it would depart from the Net-Zero Banking Alliance, which organizes banks to align on reducing their carbon emissions, on net, to zero by 2050. The bank said in an email that it remains committed to net-zero goals.
“We aim to contribute to real-economy decarbonization by providing our clients with the advice and capital required to transform business models and reduce carbon intensity,” Morgan Stanley stated. “We will continue to report on our progress as we work towards our 2030 interim financed emissions targets.”
NZBA started in 2021 and ensures banks remain aligned with the Paris Agreement’s goal of meeting net-zero emissions by 2050 or sooner. NZBA did not respond to a request for comment on Morgan Stanley’s exit from the group.
However, the coalition’s future looks grim, as Morgan Stanley’s exit shortly followed several other banks dropping out, including Citigroup, Bank of America, Goldman Sachs, and Wells Fargo.
Financial firms have faced scrutiny from Republican politicians, who oppose companies committing to climate initiatives.
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The House Judiciary Committee posted “ANOTHER WIN” after Wells Fargo and Goldman Sachs left the climate banking group. The committee said Chairman Jim Jordan (R-OH) “exposed the woke ESG climate cartel. Now, some banks are doing the right thing and leaving it!”
In November, Texas and other Republican-led states filed a lawsuit against investment firms BlackRock, State Street, and Vanguard, claiming the firms used green investments to limit coal production.