Net Zero Banking Alliance dissolves, becomes guidance framework

The Net Zero Banking Alliance announced Friday that it has ceased operations immediately after remaining members voted to transition the coalition from a member-based alliance into a guidance framework, ending a four-year effort to coordinate bank commitments to slash financed emissions. The alliance said its Guidance for Climate Target Setting for Banks and related implementation resources will remain publicly available for individual banks to use as they develop their own net-zero transition plans.

Formed in 2021 under the umbrella of the United Nations Environment Programme Finance Initiative and led by banks, the NZBA once counted nearly 150 members and at its peak represented more than 40 percent of global banking assets. The alliance pledged to align lending, investment and capital markets activities with a goal of net-zero greenhouse gas emissions by 2050.

The collapse of the member-based coalition followed a wave of high-profile withdrawals over the past year. Several of the largest U.S. banks left after the November 2024 U.S. election, with Goldman Sachs among the first to announce an exit in the month after the vote and JPMorgan Chase departing by January, completing a...