SUSTAINABILITY
“ Emissions are heavily coupled with financial revenue . Until this coupling effect is tackled , it is difficult to trust that any combination of offsetting and carbon removals in their current state will have a tangible effect on reducing global GHG emissions .”
One of the problems , as Elliot Coad explains , is that banks and FIs are simultaneously making efforts to reduce their own emissions while bankrolling the fossil fuel industry . “ A ShareAction report from earlier this year found that the 25 banks that signed up to reduce emissions as part of the Net-Zero Banking Alliance had provided US $ 33bn in loans and other financing to 50 companies with large oil and gas expansion plans . This is despite the publication of an IEA report in May that said there should be no investment in new oil and gas fields in order to have a 50 % chance of capping global warming at 1.5 º C above the preindustrial average .”
What can finance do to have a positive impact ? Transitioning towards a green future can seem like a daunting prospect for any organisation . Carbon offsetting is one way to get started – but what other options are there for businesses that want to have a positive impact , but don ’ t know where to begin ? It is still worth focusing on any business premises , Coad says , because commercial buildings alone make up 6.6 % of global GHG emissions .
And David Turner says there are several steps that banks , fintechs and FIs can take to realise quick wins : “ One of the simpler things any company can do is reduce its Scope-2 emissions , cutting its reliance on carbonheavy energy providers . If every company
90 February 2023