Ginny Cleaveland, Deputy Press Secretary, Federal Communications, Sierra Club, email@example.com, 415-508-8498 (Pacific Time)
NEW YORK — Today, JPMorgan Chase, the largest U.S. bank and the world’s biggest funder of fossil fuels, released its newest climate report, in addition to an updated methodology report and a white paper on methane emissions.
In the climate report, Chase takes some encouraging steps forward, including disclosing, for the first time, its absolute financed emissions, and adjusting its sectoral emissions reduction targets to align with the International Energy Agency’s Net Zero Emissions by 2050 scenario, which is widely regarded as the most credible transition pathway to keep global warming below 1.5°C. Chase surpasses some of its peers with the quality of disclosures around its capital markets activities by including the full share of its underwriting in its emissions reduction targets.
Despite the steps forward, there are some significantly troubling elements to the bank’s updated climate strategy. Top among these concerns is the bank’s new approach to reducing emissions in the oil and gas sector. Previously, Chase had a relatively weak 15% financed emissions intensity reduction target for oil and gas clients’ end-use emissions. In its new report, the bank scraps this target in favor of an “energy mix” target, which broadens the scope to include solar, wind, hydro, biomass, nuclear, and geothermal — in addition to oil and gas. Though the bank claims that the updated target represents an increase in ambition, the reality is that this new target may actually be a worrying step back. By broadening the scope of the target, it seems it will now be easier for the firm to report progress on the target by increasing financing for low-carbon energy without decreasing — or even while increasing — financing for oil and gas expansion.
In addition to the concerning new approach to oil and gas emissions reduction targets, the new reports do not disclose a credible transition plan for how the firm will manage its portfolio to exit, reduce exposure to, or otherwise hold accountable companies that fail to decarbonize in line with those goals. Beyond this, the firm has again failed to match the ambition of some of its peers by not setting absolute financed emissions targets for oil, gas, and coal production. This is despite concerns from shareholders and clients who worry about the credibility of intensity-only approaches, which may not lead to reductions of financing for the most polluting industries or reductions in real-world emissions.
In response, Adele Shraiman, Senior Campaign Strategist with the Sierra Club’s Fossil-Free Finance campaign, issued the following statement:
“In its latest climate report, JPMorgan Chase takes some important steps forward, including by disclosing, for the first time, its financed emissions on an absolute basis, and by adjusting its sectoral emissions targets to align with the IEA’s Net Zero Emissions by 2050 scenario. However, Chase has also decided to take a concerning new approach to its financed emissions reduction target for the energy sector, which could obscure its continued financing for the expansion of oil and gas production. Chase’s report shows that the absolute emissions from its energy financing are enormous, but it fails to disclose a target for actually reducing them. As the world’s largest funder of fossil fuels, Chase still has a long way to go to align its business with global climate goals. It is past time for Chase to adopt a truly transparent and credible plan that cuts off financing for the most polluting companies that fail to transition in line with those goals.”
In 2021, the bank released its first set of emissions reduction targets for the oil and gas, power generation, and auto manufacturing sectors. In December 2022, the bank published additional emissions reduction targets for the iron, steel, cement, and aviation sectors. The key weakness with all of these targets is that they are based only on a reduction in emissions intensity. Intensity targets still allow for an overall increase in financed emissions, and are therefore not commensurate with what’s needed to reach global climate goals.
In November 2022, the Sierra Club’s Fossil-Free Finance campaign released a report analyzing the interim 2030 targets and exclusion policies of the six major U.S. banks, including JPMorgan Chase, revealing that the banks’ commitments fall short of what’s needed to meet global climate goals. The report also establishes recommendations for credible and robust targets and policies.
In July 2023, the Sierra Club’s Fossil-Free Finance campaign released a report on the role of big US banks in capital markets, revealing a hidden pipeline for fossil fuel financing through the banks’ underwriting of bonds and equities for polluting companies. The analysis raised important questions about how the 6 biggest US banks calculate and report on their facilitated emissions, and made the case for the importance of banks’ capital markets activities in achieving real-world emissions reductions.
The latest annual Banking on Climate Chaos report, released in April 2023, showed that JPMorgan Chase has been the world’s largest funder of fossil fuels in the years since the Paris Agreement, providing $434 billion in lending and underwriting to fossil fuel companies between 2016-2022.
About the Sierra Club
The Sierra Club is America’s largest and most influential grassroots environmental organization, with millions of members and supporters. In addition to protecting every person's right to get outdoors and access the healing power of nature, the Sierra Club works to promote clean energy, safeguard the health of our communities, protect wildlife, and preserve our remaining wild places through grassroots activism, public education, lobbying, and legal action. For more information, visit www.sierraclub.org.