In the first assessment of how Australia’s largest banks are performing on achieving their commitments to reach net zero emissions, none of the big five banks scored more than 63 points out of a possible 100.

The Commonwealth Bank scored 62/100, followed by NAB (55), Westpac (47), Macquarie (46) and ANZ (35) in the Australian Conservation Foundation analysis.

The benchmarking report found:

  • All big five banks have committed to net zero, but there remain big gaps between their headlines commitments and the policies and practices to get there.
  • Big five bank policies on fossil fuel lending exclude most of the ways they raise finance for the coal, gas and oil sectors, leaving loopholes to continue financing fossil fuels.
  • Macquarie is the only bank to restrict lending to companies building new or expanded coal projects. CBA is the only bank to prohibit direct lending to new oil and gas projects. None of the banks have a policy to restrict lending to companies building new oil or gas.
  • ANZ has not disclosed any analysis to determine how the bank will be impacted by the impacts of climate change and the transition to net zero.
  • Australia’s banks are not fully integrating action on climate change into their governance – for example by making it a board-level priority and incentivising senior management to achieve climate action targets.

“Australia’s first benchmark of banks’ net zero commitments report reveals that while the nation’s largest five banks have made some progress in the race to zero, there remain gaping holes in their policies and governance that must be filled,” said Jonathan Moylan, ACF’s corporate campaigner and a co-author of the report.

“While banks have made bold headline commitments, we have found too many gaps in policies, performance and disclosure when it comes to progress towards the targets.

“When banks set targets relating to their exposure to coal, oil and gas, their goals tend to mention lending only, but when they report on their support for climate solutions, some include all the other financial services they provide, in addition to lending.  

“ANZ performed particularly badly and is the only one of the major banks that does not employ climate scenario analysis to test its exposure to physical and transition risks or have adequate expertise at board level.

“Banks can and must play a key role in mitigating climate damage and scaling up solutions.

“Banks must be central in helping Australia seize the enormous opportunities of a renewable-powered economy.

“As Australia heads into what looks to be another summer of extreme weather, banks need to strengthen their policies to stop propping up projects that fuel the climate crisis.

“We want to see Australia’s banks drive action to tackle climate change, while championing best practice in governance, strategy and accountability.”

From laggards to leaders: An assessment of Australian banks’ climate commitments

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