Wells Fargo, Commerzbank and UniCredit are among the world’s biggest banks yet to sign on to a climate change initiative championed by Bank of England governor Mark Carney and billionaire Mike Bloomberg that would help environmental impact investors allocate their funds.
The Task Force on Climate-related Financial Disclosures (TCFD) seeks to get banks and other companies to calculate the risks — and opportunities — posed to their business by global warming. “The finance sector has, perhaps, the most crucial role of all to play in the transition to a low-carbon economy,” the report stated. “Financial flows need to be unleashed for this at a grand scale.”
Yet 28 of the top 75 banks by assets have failed to signal their support for the program, according to a report this week from BCS Consulting. The TCFD, which was launched in 2015 by the U.K.’s Financial Stability Board, says its initiative is supported by nearly 900 companies and organizations worldwide.
Chinese banks dominate the absentee list, BCS said, adding to doubts about that country’s commitment to tackling climate change. U.S. Bancorp also hasn’t signed on, along with France’s Groupe BPCE and Italy’s DZ Bank.
The TCFD initiative has been championed by BOE governor Mark Carney and former New York mayor Michael Bloomberg. Yet progress at signing banks up has been “uneven,” and even among the program’s supporters, only a quarter have provided a “fuller set” of disclosures, Carney said in a speech last week. He warned that banks should hurry up as jurisdictions including the European Union and U.K. plan to make participation mandatory.
Seventy-six banks have signed onto the TCFD initiative, representing 40 percent, or $59 trillion, of total global banking assets, BCS said in its report. Of these, just 39 have started disclosing climate risk information in line with the task force’s framework, and the rate at which banks are signing up has slowed significantly this year, it said.
UniCredit said it would sign up in the near future, while Commerzbank said the issue was “on agenda,” the Financial Times reported Tuesday. Wells Fargo said it recognizes concerns about climate change and that it’s working to find solutions, according to the newspaper.
An appetite for greater climate disclosure among institutions engaged in environmental, social and governance (ESG) investing, is clear, with firms including Aviva, California Public Employees’ Retirement System and Legal & General all pledging their support for the TCFD program.