FOR IMMEDIATE RELEASE: Friday, March 17, 2023
Media contact: Arielle Swernoff, arielle@stopthemoneypipeline.com, 925-262-3004 (Eastern Time)
Advocacy Groups Respond to Bank, Insurance Proxy Statements Opposing Climate & Indigenous Rights Resolutions
Climate groups call out Citi, Bank of America, Wells Fargo, RBC, and others for greenwashing
New York, NY – This past week, Citi, Bank of America, Wells Fargo, and Royal Bank of Canada released proxy statements ahead of their annual general meetings encouraging shareholders to vote against climate and Indigenous rights resolutions. These statements contain spurious, misleading, and greenwashing claims about the institutions’ existing climate commitments and their relationships with the oil and gas industry.
“No North American bank has announced climate plans that are in line with the scientific consensus of what’s needed to keep global warming below 1.5℃. The global scientific community is clear: financing for fossil fuel expansion needs to stop now. Banks are willfully choosing climate destruction, instability, and death in order to pocket a few more dollars through continued financing of their fossil fuel clients,” said Aditi Sen, Director of Climate and Energy for Rainforest Action Network.
Without a clear plan to phase out financing of fossil fuel expansion, banks are creating a financially dangerous and risky carbon bubble, over-valuing their investments in new fossil fuel reserves that will, one way or another, not make it to market. According to economic forecasters, when this carbon bubble bursts, it could cause a financial crisis much larger than the 2008 Great Recession. Banks are claiming they must continue to invest in fossil fuels to prevent disruption to the global economy, but their continued funneling of money to fossil fuel projects that will be retired before the end of their financial life is the real risky move.
“Banks are misleading investors into thinking these climate resolutions are something they’re not. These climate resolutions simply call for guardrails on energy transition financing to ensure banks are not greenwashing their climate commitments. Proponents want banks to adopt policies to phase out clients that pursue controversial projects that are at high risk of becoming stranded assets and are misaligned with global climate goals. These climate resolutions target better management of exposure to risky clients, and prudent investors would be wise to support such efforts,” said Jessye Waxman, Senior Campaign Representative in the Sierra Club’s Fossil-Free Finance campaign.
According to an influential report released by the International Energy Agency in 2021, as well as a growing consensus of the world’s leading scientists and energy experts, in order to have a fifty percent chance of curtailing global warming to 1.5 degrees Celsius and limiting the worst impacts of the climate crisis, investment in new fossil fuel supply needs to cease.
Despite these clear and dire warnings, and despite public pledges to be Paris-aligned, the seven largest North American banks – JP Morgan Chase, Citigroup, Bank of America, Wells Fargo, Morgan Stanley, Goldman Sachs, and Royal Bank of Canada – provided nearly $500 billion in lending and underwriting to the 100 corporations most aggressively expanding fossil fuel operations from 2016-2021. Meanwhile, US-based insurance giants Chubb, The Hartford, and Travelers are among the top insurance providers to the global oil and gas industry.
At the same time, these banks claim in their proxy statements that their climate strategy is to invest in green energy, yet on average, a mere seven percent of bank loans and underwriting in the energy sector went to renewables between 2016 and 2022. Citi, Chase, and RBC’s renewable energy share was all at two percent or below.
Citi additionally claimed it will be holding its AGM online to reduce the bank’s carbon footprint, a ridiculous assertion from the world’s second largest funder of fossil fuels.
“These proxy statements are simply more greenwashing from the biggest greenwashing institutions in the world. You can’t claim you’re investing in renewables when only two cents of every dollar spent in energy financing go to green energy. Banks claim they want to help their clients transition, yet no fossil fuel company has a credible transition plan in line with the Paris framework. Either the banks are concealing information about their clients plans from shareholders, or they’re suckers, believing lies from fossil fuel companies when the evidence is right in front of their faces. Both options are bad news for shareholders, the planet, and the economy,” said Arielle Swernoff, US Banks Campaign Manager at Stop the Money Pipeline.
In recent years, Citi has provided financing for projects and companies that clearly violate Indigenous rights: they were a lead financier of the Dakota Access Pipeline in 2016; provided over $5 billion to Enbridge, enabling the Line 3 and Line 5 pipelines; and helped GeoPark secure over $650 million for oil drilling in the Colombian Amazon despite a lack of consent from local Indigenous peoples and a clear history on behalf of the company of damaging Indigenous lands, health, and livelihoods.
“If Citi cared about Indigenous rights, they would not have been a lead financier of the Dakota Access Pipeline, they would not have provided financing to Enbridge for Line 3 and Line 5, and they would not have helped GeoPark secure funds to drill oil in the Amazon. In all of these cases, Indigenous communities made their opposition clearly and vociferously known. To say that Citi has respectful and positive engagement with Indigenous peoples is simply insulting,” said Amy Gray, Senior Climate Finance Strategist at Stand.earth.
Additionally, Jillianne Lyons of Investor Advocates for Social Justice, which supported the filing of Citi’s Indigenous Rights resolution, said, “Citigroup has a history of financing companies or projects that violate the rights of Indigenous Peoples. It served as a lead financier of the Dakota Access Pipeline in 2016, and continues to enable projects like Enbridge Line 3, Line 5, and Geopark’s Amazon drilling that are starkly opposed by Indigenous communities. Citigroup has a responsibility under the UN Guiding Principles on Business and Human Rights to ensure its financing activities are not violating the rights of Indigenous Peoples.”
In their opposition to resolutions calling for greater transparency around Indigenous rights, Royal Bank of Canada claims they have positive and respectful engagement with Indigenous communities, an assertion contradicting the claims and experiences of Indigenous leaders, as well as the bank’s own financing.
Banks also falsely claimed that continued investment in fossil fuel companies is needed to meet global energy needs given turbulent geopolitics, particularly the unjust invasion of Ukraine by Russia. However, new fossil fuel projects that receive financing today would take several years to make it to market – hardly in time to support this or next winter’s energy needs. Instead, investments in renewables could serve to increase the stability of global energy needs in times of geopolitical crisis.
###