Full Breakdown
Major Banks Continue Financing Fossil Fuels Despite Climate Commitments
10/22/2025, 11:15:33 AM
Overview of the Current Situation
Recent research from the TPI Global Climate Transition Centre at the London School of Economics reveals that no major bank has committed to halting funding for new oil, gas, or coal projects. The analysis assessed 36 of the largest banks globally, finding that many have weakened their climate policies rather than strengthened them. The report indicates that 95% of banks' climate policy scores remained unchanged year-on-year, with the average score covering only 18% of the 77 sub-indicators evaluated.
Key Findings from the Research
The TPI report highlights that banks have diluted their commitments, replacing definitive terms like "commitment" with vaguer terms such as "ambition." Algirdas Brochard, banking project lead at TPI, emphasized the implications of banks' slow progress on climate transition, suggesting that the objectives of the Paris Agreement are increasingly out of reach. Furthermore, a separate analysis revealed that since the Paris Agreement was adopted in 2016, major banks have provided nearly $7 trillion in funding to the fossil fuel industry.
Financing in the Amazon
In a related context, banks have reportedly invested $2 billion in oil and gas financing in the Amazon since 2024. This funding has been criticized for exacerbating environmental degradation and threatening Indigenous communities. Notably, Itaú Unibanco, JPMorgan Chase, and Bank of America have been identified as significant contributors to this financing, with Itaú leading the charge at $378 million. The report from Stand.earth indicates that over 80% of this financing has gone to just six oil and gas companies, many of which have been linked to human rights violations.
Criticism from Indigenous Leaders
Indigenous leaders have voiced strong opposition to these financing practices. Jonas Mura, chief of the Gavião Real Indigenous Territory in Brazil, stated that the activities of companies like Eneva have severely impacted their way of life, leading to a decline in wildlife and threatening their survival. Olivia Bisa, president of the Autonomous Territorial Government of the Chapra Nation in Peru, echoed these sentiments, calling for banks to cease their support for extractive industries in the Amazon.
Official Statements & Responses
The collapse of the Net Zero Banking Alliance (NZBA) has further complicated the landscape. Following the withdrawal of major banks after the election of U.S. President Donald Trump, the NZBA disbanded, signaling a retreat from collective climate commitments. Experts suggest that this disbandment may lead to increased regulatory momentum as the voluntary system has been discredited.
Broader Implications
The ongoing financing of fossil fuels by major banks poses significant risks not only to the environment but also to global economic stability. Investors representing over $3 trillion in assets have called for urgent action to halt deforestation and ecosystem degradation, framing these issues as material financial risks. The upcoming COP30 in Belém, Brazil, is expected to be a pivotal moment for addressing these challenges.
What's Next
As the international community prepares for COP30, the pressure on banks to align their financing practices with climate goals is mounting. The need for robust, mandatory frameworks regulating financial investments in fossil fuels is becoming increasingly urgent, as stakeholders recognize the critical role of finance in the global energy transition.
