A major global alliance of banks committed to achieving net-zero emissions has abruptly ceased operations. The Net Zero Banking Alliance (NZBA), once boasting nearly 150 members, announced its immediate dissolution following a period of significant turmoil and member departures. The group stated its guidance would transition into a publicly available “framework” for individual banks to use, but the collective body itself is no more.
The catalyst for this collapse appears to be political. The alliance began to fracture late last year after Donald Trump was re-elected, running on a platform that promised aggressive deregulation of the energy sector. His “drill, baby, drill” slogan and a broader political pushback against environmental, social, and governance (ESG) principles created a challenging environment for member banks, particularly in the United States.
Fearing “anti-woke” attacks from right-wing politicians, six of Wall Street’s biggest names—JPMorgan Chase, Citigroup, Bank of America, Morgan Stanley, Wells Fargo, and Goldman Sachs—led the charge for the exits. Their departure, even before Trump’s inauguration, signaled a major blow to the alliance’s credibility and momentum, triggering a domino effect across the global financial landscape.
Following the US banks, major European and Japanese lenders also began to withdraw their support. The trend hit the UK when HSBC, a significant global player, quit the alliance in July. HSBC had already been criticized for delaying its climate goals by two decades. Barclays, another British banking giant, followed suit just weeks later, further cementing the alliance’s fate.
The shutdown has drawn mixed reactions. While some campaigners, like Jeanne Martin from ShareAction, called the move “bitterly disappointing” and a failure of courage from senior bankers, others were less surprised. Lucie Pinson of Reclaim Finance stated she “won’t mourn” the NZBA’s demise, labeling it an “illusion of measures” that was “doomed to fail.” She argued that meaningful climate action in finance will only come from policymakers and regulators, not voluntary industry pacts.