CommBank’s climate policy update leaves ANZ, NAB and Westpac in the dust
This morning Commonwealth Bank announced a host of new fossil fuel finance restrictions, bringing Australia’s biggest bank closer to alignment with its commitments to the goals of the Paris Agreement and net zero emissions by 2050. Announcing a series of firsts for a major Australian bank, these latest restrictions leave CommBank’s peers ANZ, NAB, and Westpac, as clear climate laggards with plenty of work to do to catch up.
The new policy categorically rules out direct finance for all new and expanded oil and gas extraction projects, as well as some critical enabling infrastructure, such as pipelines to new oil and gas fields. However, CommBank has failed to rule out lending to new liquefied natural gas (LNG) projects, which can unlock new gas fields and pose some of the greatest threats to curbing climate change globally.
CommBank has also said it will not fund any fossil fuel company from 2025 that does not have an independently verified plan to cut all emissions – including from the end use of their coal, oil and gas – in line with the Paris Agreement’s ‘well-below 2°C’ upper warming limit. While it’s concerning that CommBank has left the door open to financing climate wrecking companies until the end of next year, and won’t enforce alignment with the much less dangerous 1.5°C Paris goal, the updated policy sends a stark warning that funding for dirty fossil fuel expansion plans is drying up.
The policy update reinforces a positive trend in CommBank’s recent lending behaviour. In the last two years, CommBank has loaned the least to fossil fuels of the big four Australian banks, with its $267 million in 2022 a 92% decrease from its peak high of $4 billion in 2018, and significantly less than its peers.
While the job of hauling CommBank into line with its climate commitments is not done yet, the significant progress shown by Australia’s biggest bank is proof that people power can, and will, shift the biggest financial institutions and keep billions out of climate wrecking fossil fuel expansion. Congratulations to all the CommBank customers, shareholders, staff and community members who have stood up and demanded real climate action.
Read an extended analysis of the new policy on the Market Forces website here.