The Net Zero Banking Alliance (NZBA has suspended its activities following a dramatic withdrawal of major members and growing global scepticism towards green enterprise.
Goldman Sachs was the first to quit the alliance a month, which triggered a cascade of exits, with Morgan Stanley, Citigroup and JPMorgan Chase all following suit.
The banks left as Donald Trump returned to the White House last November, with Republicans accusing financial firms of breaching competition law through their climate pledges. The bank’s move
The exodus has not been limited to American institutions. In recent weeks, British lenders HSBC and Barclays have also walked away - further damaging the coalition’s credibility.
The group, co-founded in 2021 by former Bank of England governor and current Canadian Prime Minister Mark Carney, announced on Wednesday that it will now hold a vote on whether to abandon its membership model altogether.
The UN-backed alliance had previously committed members to aligning lending and investment portfolios to achieve net-zero carbon emissions by 2050. Carney launched the partnership as the UN’s special climate action and finance envoy.
He aimed to enlist the banking sector in the fight against global warming, arguing that finance must be at the heart of efforts to cut emissions.
In a statement, the Net Zero Banking Alliance (NZBA) said its suspension and internal vote resulted from "member input" and that its steering committee believed a new structure based on providing "guidance" rather than binding commitments would be more sustainable.
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The net zero group, co-founded by Mark Carney, is facing an exodus of major lenders
| PAIf approved, the shift would see the coalition transform into a looser framework initiative with no formal members, a model that critics say strips the group of any remaining influence.
The broader backlash has made banks nervous about legal challenges and political pressure.
For many, the costs of remaining in the NZBA outweighed the potential reputational benefits, leading to questions about the viability of voluntary industry coalitions to drive systemic change.
Donald Trump has sparked controversy for declaring that climate change is “one of the great scams”
| REUTERS
Net-Zero Banking Alliance suspended
| GETTYEnvironmental campaigners argue that the collapse of the alliance is proof that voluntary pledges are ineffective. Katrin Ganswindt, Head of Financial Research at the NGO Urgewald said: "When the world is on fire, we need climate action, not climate talk.
"Voluntary alliances like NZBA did not deliver. Fossil fuel finance needs effective regulation, which would also improve the financial system's resilience.
"Central banks, bank regulators and oversight agencies should finally step up to the plate. They should start by drawing a clear line at the financing of fossil fuel expansion."
Despite the outcome of the NZBA’s vote not being expected until next month, its retreat is likely to be seen as a significant setback for those who hoped that finance could take a leading role in addressing climate change, whatever the result.