Back in September Goldman Sachs joined the RE100 campaign, teaming up with other corporate giants to commit to sourcing 100% of its electricity from renewable sources, and the company called on political leaders to deliver strong climate agreement too.
Not bad, I thought, at the time—but by far the biggest impact of a financial institution like this is not where it buys its electricity from, or what policy positions it advocates, but where it invests its money.
Here too, however, Goldman Sachs is upping its game—committing to investing $150bn in clean energy by 2025 as part of its efforts to tackle climate change. The announcement is note worthy not just because of the sheer amount of money involved, but also because it marks a huge step up from a previous commitment—to invest $40bn by 2022—which has pretty much been met already.
Before we get carried away, we should note that there's still plenty of room for improvement. Ben Collins, Senior Research and Policy Campaigner for Rainforest Action Network, noted in response to Goldman Sachs' latest announcement that the bank is still heavily invested in dirty fossil fuels—most notably coal:
“It is encouraging that the new Environmental Policy Framework from Goldman Sachs acknowledges the bank’s responsibility to address climate change. However, on the critical issue of financing coal, the bank is playing catchup with half-measures at a time when leadership from major financial institutions is critically needed. Providing financing for new coal mines and power plants is simply incompatible with keeping our planet below two degrees of warming. With the Paris climate summit just weeks away, it’s past time for the bank to end its financing for coal, period.”
With Bank of America dumping coal mining and ANZ bank refusing to finance any new coal plants without carbon capture and storage, banks' sustainability commitments are increasingly being measured not just in what they are willing to finance, but also in where they will draw the line.
It's an encouraging sign of the times, I guess, that a bank can announce a huge commitment to investing in renewables only to be greeted with calls that it can and must do more.