The Net Zero Banking Alliance (NZBA) has admitted defeat. Following a mass exodus of its most influential members, the global banking group has announced that it will cease all operations immediately, marking the end of a major, but ultimately unsuccessful, attempt at industry-led climate action.
The battle was lost on the political front. The alliance could not withstand the pressure that mounted after the re-election of Donald Trump. His administration’s anti-environmental agenda fueled a powerful “anti-woke” movement in the US, which declared war on corporate ESG initiatives.
The first to surrender were the American banks. The six largest financial institutions on Wall Street, including JPMorgan Chase and Bank of America, waved the white flag and retreated from the alliance to avoid further conflict with right-wing politicians. Their surrender was a mortal blow to the NZBA’s cause.
This led to a wider rout. Seeing their most powerful allies fall, international members from Europe and Japan also began to withdraw. The final defeat was confirmed this summer with the departures of UK lenders HSBC and Barclays.
In the wake of this surrender, the debate over strategy has intensified. Some believe the banks should have fought harder, showing more courage in the face of political opposition. Others argue that the defeat was inevitable because the alliance was using the wrong tactics. They insist that the fight for climate finance cannot be won with voluntary pledges and must now be waged through the power of government regulation.