RBC Falls Short on Climate Pledges – IEEFA

The Royal Bank of Canada’s (RBC) climate and sustainable finance policies will not fulfil its net zero objectives, according to a briefing by the Institute for Energy Economics and Financial Analysis (IEEFA). The report said  RBC’s strategies lack essential updates to curtail fossil fuel expansion and are devoid of concrete target dates. Additionally, the plans contain exceptions for significant segments of RBC’s business from adhering to the stated climate goals, raising concerns about the bank’s ability to effectively achieve its net zero finance objectives. Mark Kalegha, Energy Finance Analyst at IEEFA and co-author of the report, said: “Given RBC’s outsized role in funding the fossil fuel industry and its position at the top of Canada’s banking industry, it is reasonable to expect RBC to set and meet high standards. The bank should be a policy leader.” The IEEFA report also highlighted RBC’s 2030 interim emission reduction goals, which focus on emission intensity rather than absolute emissions potentially allowing the bank to achieve its targets without genuinely reducing financed emissions. Critics of RBC’s Sustainable Finance Framework claim that it appears to be driven by client demands, primarily from the oil and gas industry, rather than being grounded in a robust climate policy. The report calls on RBC to recognise the ongoing impact of the energy transition and the declining prospects of the fossil fuel industry. 

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