Report on Reducing GHG Emissions Associated with Lending Activities
WHEREAS: Banks can play a critical role in meeting the Paris Agreement’s goal of limiting global temperature rise to well below 2 degrees Celsius. Limiting global warming below 1.5 degrees versus 2 degrees will save $20 trillion globally by 2100. Yet, the Bank of England notes that the global financial system is currently supporting carbon-producing projects that will cause global temperature rise of over 4 degrees Celsius – more than double the limit necessary to avoid catastrophic warming. Recently, 215 global companies reported almost $1 trillion at risk from climate impacts, with many likely to occur within five years.
JPMorgan Chase’s funding contributes substantially to global climate change. The company is the largest source of financing to fossil fuel companies globally, averaging $65 billion annually since the Paris Agreement was signed. This funding creates systemic portfolio risks to the global economy, investors, and its own operations. Recognizing this, the European Investment Bank, the biggest multilateral lender in the world, will stop funding fossil fuel projects in 2021.
In contrast to JPMorgan, peer banks are beginning to responsibly address their greenhouse gas contributions by developing carbon measurement tools -- including the Paris Agreement Capital Transition Assessment and the Partnership for Carbon Accounting Financials -- and setting carbon limits on their financing. HSBC has committed to set a Science-Based Target. ING, BNP Paribas, Standard Chartered, and other banks have committed to measure the climate alignment of their lending portfolios against Paris goals. Some have abandoned high risk sectors including Arctic drilling and tar sands. Citibank joined the Principles for Responsible Banking, committing to align its business strategy with the Paris Agreement’s global climate goals.
While JPMorgan has increased its ‘clean’ financing, recognises climate change, and is sourcing renewable energy for its operations, its annual $22 billion in clean financing over 9 years is substantially outweighed by its fossil fuel funding activities. JPMorgan does not yet measure or disclose its full carbon footprint, nor has it adopted targets to reduce its lending related greenhouse gas (GHG) emissions. Banks that finance carbon intensive, fossil fuel activities through their lending are putting themselves and society at risk of catastrophic climate impacts.
RESOLVED: Shareholders request that JPMorgan Chase issue a report, at reasonable cost and omitting proprietary information, outlining if and how it intends to reduce the GHG emissions associated with its lending activities in alignment with the Paris Agreement’s goal of maintaining global temperature rise below 1.5 degrees Celsius.
Supporting Statement: Shareholders recommend the report disclose, among other issues, at board and management discretion:
- Any actions JPMorgan is taking to measure and disclose its full carbon footprint (Scope 1-3 emissions, including GHG emissions associated with its lending activities);
- Whether the bank is considering setting targets, and on what timeline, to reduce the carbon footprint of its lending activities.