· 2 min read
illuminem summarises for you the essential news of the day. Read the full piece on The Wall Street Journal or enjoy below:
🗞️ Driving the news: Global banks significantly increased their financing of fossil-fuel projects in 2024, with a record $869.4 billion in funding, up 23% from the previous year
• This surge, led by U.S. institutions such as JPMorgan Chase, Bank of America, and Citigroup, raises concerns about the financial sector’s commitment to meeting climate goals and the broader shift towards clean energy
🔭 The context: The increase in fossil-fuel financing comes amid global efforts to combat climate change, including commitments under the Paris Agreement and COP28 to phase out fossil fuels
• However, despite promises of transitioning to low-carbon economies, many financial institutions have diluted their climate pledges, highlighting a disconnect between climate objectives and the pursuit of short-term profits
🌍 Why it matters for the planet: The surge in fossil-fuel financing directly undermines global climate efforts
• As the financial sector funds new oil, gas, and coal projects, it locks in further emissions and perpetuates reliance on "dirty energy"
• This threatens the achievement of the 1.5°C global warming target and impedes the necessary transition to renewable energy, highlighting the need for stronger regulatory action
⏭️ What's next: Climate advocates are calling for binding regulations to curb fossil-fuel financing, urging financial institutions to adopt more rigorous transition plans
• As more banks withdraw from climate commitments like the Net-Zero Banking Alliance, international regulators and policymakers will face increasing pressure to enforce stricter standards on financial institutions to safeguard long-term environmental and economic stability
💬 One quote: “Without binding regulation, banking on climate chaos will remain banks’ dominant investment strategy, tanking our economy and our planet” — Allison Fajans-Turner, policy lead at the Rainforest Action Network
📈 One stat: In 2024, global banks committed $869.4 billion to fossil-fuel financing, a 23% increase from the previous year, making it equivalent to the GDP of Switzerland
See on illuminem's Data Hub™ the sustainability performance of JPMorgan Chase, Bank of America, Citigroup, and its peers Goldman Sachs and Barclays
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