"When climate commitments bite, banks retreat - it’s time for real rules", 27 August 2025

When it comes to climate action, voluntary commitments from the world’s biggest banks are failing. The pattern is clear: when the promises threaten to bite, ambition collapses and the establishment closes ranks to protect short-term profits. The recent exit of UK banks HSBC and Barclays from the Net-Zero Banking Alliance (NZBA) is just the latest evidence that voluntary frameworks are simply not up to the task.

Triodos Bank left the NZBA in April for very different reasons. It was in direct response to a vote by a majority of member banks that lowered the climate ambition of the alliance and set less strict requirements...

Voluntary commitments can be useful for setting broad frameworks, tracking progress, and establishing shared standards. They have encouraged investment in renewables and sustainable industries. But the reality is that when real change is required, such as ending new fossil fuel financing, voluntary agreements fail. The moment these commitments begin to threaten established business models and profits, the sector band together to defend its interests. The establishment, boards, lobbyists, and industry groups dominate the debate, suppressing ambition and prioritising short-term returns over long-term planetary health.

This is occurring almost a decade after the Paris Agreement, where countries pledged in Article 2.1 to ‘make finance flows consistent with a pathway towards low greenhouse gas (GHG) emissions and climate-resilient development’. Yet, the vague language of Article 2.1c has allowed the financial sector to delay meaningful action. Ten years on, there is still no consensus on what aligning financial flows with climate goals actually means, and there is no enforcement.

The lesson of the NZBA departures is clear: voluntary commitments are no substitute for real accountability. The time for delay is over. If we are serious about avoiding the human and economic costs of unchecked climate change, only the force of law will suffice.

See also: HSBC and Barclays' statements on their exit from the Net-Zero Banking Alliance.