The Bank of America announced last week that it was committing a further $300 billion in capital by 2030 to low-carbon & sustainable business activities as part of its Environmental Business Initiative, its third such commitment which brings the bank’s total investments up to $445 billion since 2007.
Bank of America’s Environmental Business Initiative is part of its larger focus on facilitating the deployment of capital to further sustainable development. The bank identified the significant discrepancy between the capital that must be applied to global challenges and the actual amount of capital that is being deployed to tackle these challenges and is moving to engage the private sector by mobilizing players across the entire financial system to increase this necessary flow of capital. Bank of America will deploy its capital through lending, investing, capital raising, advisory services, and developing financing solutions (but excluding corporate expenses) to accelerate the transition to a low-carbon and sustainable economy.
This third commitment brings the Bank of America’s total commitment to $445 billion since 2007 and it has already deployed $126 billion over the past twelve years in support of environmental business initiatives across the globe.
“The need to mobilize and deploy capital to address climate change has never been more urgent,” said Bank of America Vice Chairman Anne Finucane. “As one of the world’s largest financial institutions, Bank of America has a responsibility and an important role to play in helping to mitigate and build resilience to climate change by using our expertise and resources, as well as our ability to convene partners across sectors, to accelerate the transition from a high-carbon to a low-carbon society.”
So far the Bank of America has issued $4.35 billion in corporate green bonds since 2013 — including its fourth and largest green bond issued in May of 2018, a $2.25 billion bond — and is ranked as the number-one tax equity investor in the United States from 2015 through 2018 according to Bloomberg New Energy Finance and has been responsible for approximately $10.5 billion of renewable energy tax equity financing supporting wind and solar facilities.
Unfortunately, the Bank of America is also one of the four biggest global bankers of the fossil fuel energy sector, according to a report published last month by the Rainforest Action Network, BankTrack, Indigenous Environmental Network, Oil Change International, Sierra Club, and Honor the Earth, and endorsed by over 160 organizations around the world. Specifically, the report found that Bank of America committed $106.69 billion to the fossil fuel industry between 2016 and 2018.
“We’re faced with ever-worsening climate change impacts worldwide, and the latest IPCC report provides a stark 2030 deadline for the deep cuts in global CO2 emissions needed to avoid full climate breakdown,” said Johan Frijns, Director of BankTrack, speaking last month. “Yet banks continue to throw their billions at the fossil fuel industry while announcing minor policy tweaks here and endorsements of the latest toothless ‘responsible finance’ initiative there. One wonders what on earth it will take for banks to finally change course and fully abandon the fossil fuel sector. Campaigners will be demanding exactly this at this year’s upcoming bank AGMs, armed with this report’s shocking new findings.”