The chief executives from Canada’s 5 largest banks confronted exhausting questions from MPs on Thursday over their local weather commitments and plans to assist spur transition to renewable vitality.
Representatives from RBC, CIBC, TD Financial institution Group, BMO Monetary Group and Scotiabank appeared Thursday earlier than the standing committee on setting and sustainable growth. All 5 attended by video convention, avoiding an in-person listening to.
NDP MP Matthew Inexperienced took goal at David McKay, the top of RBC, the nation’s largest financial institution, for “touting” his local weather document, whereas “persevering with to be one of many largest financiers of fossil fuels on this planet.”
“This can be a transition,” McKay mentioned in response.
“It is a advanced transition. We aren’t getting off fossil-based fuels instantly. To only cease just isn’t an possibility for us. Now we have to decide to discovering inexperienced sources of vitality.”
Canadian banks have been criticized for a way sluggish that transition has been, provided that they continue to be among the many largest financiers of oil, gasoline and coal globally.
A latest report calculated that Canada’s prime banks pumped a mixed $103.85 billion US into fossil gas tasks in 2023.
The 5 largest banks have made each short- and long-term emissions discount targets, together with net-zero financed emissions by 2050, however confronted questions on whether or not these are on monitor.
One other latest report, from InfluenceMap, a world local weather coverage watchdog, discovered that Canada’s largest 5 banks haven’t aligned “their short- and medium-term emissions discount targets with their long-term internet zero commitments.”
Banks stress significance of oil and gasoline
Not one of the executives dedicated to limiting investments within the oil and gasoline sector to tasks that would cut back emissions, and a number of other careworn the significance of the sector.
“Power has been crucial to the financial system and can proceed to be essential to the financial system,” McKay mentioned.
At one level, Brandon Leslie, a Conservative MP, targeted on how banks have made investments in renewable vitality with out being pressured by authorities.
He then requested Scott Thomson, the CEO of Scotiabank, if an oil and gasoline challenge ought to be held to a special customary — aside from whether or not a mortgage could be paid again.
(A invoice proposed by Quebec senator Rosa Galvez may make it tougher for oil and gasoline tasks to safe financing.)
“I do not suppose vitality tasks ought to be held to a special customary than that,” Thomson mentioned.
Thomson later added that Canada is usually a “chief within the vitality transition,” however instructed oil and gasoline can proceed to play a task within the coming years.
“We must always transfer away from emissions reductions in any respect prices to a complete technique that encompasses all sources of vitality,” he mentioned.
Banks accused of ‘fickle’ commitments
Thursday’s testimony comes every week after the identical committee questioned the CEOs of Canada’s prime oil and gasoline producers. The committee is exploring how Canada can meet its dedication to cut back emissions.
Julie Segal, a local weather finance specialist with the advocacy group Environmental Defence, mentioned Thursday the banks’ “voluntary local weather commitments have confirmed fickle” and extra laws are sorely wanted.
“We want credible local weather transition transition plans from these banks and monetary establishments, and since they aren’t designing these on their very own we want guidelines to make sure they occur and are delivered.”
Scroll the most recent headlines and it’s straightforward to really feel local weather defeated, however between the missed targets and dire warnings are indicators of progress. CBC’s Nicole Mortillaro breaks down 3 ways the clear vitality transition is beginning to take form.
Galvez’s proposed invoice, referred to as the Local weather-Aligned Finance Act, that will impose new guidelines on Canadian monetary establishments to ensure they’re aligned with the nation’s local weather objective.
The invoice was tabled greater than two years in the past, but it surely stays on the committee stage within the Senate. It faces a number of extra hurdles earlier than it might be put to a vote within the Senate, after which make its option to the Home of Commons.
The Canadian Bankers Affiliation, which represents the nation’s largest banks, is against the laws, saying it might add pointless laws on the sector.
