Commercial banks are of crucial importance in the transition to a low-carbon economy based upon energy efficiency and renewable energies. They are indispensable in mobilising and allocating the necessary financial resources for long run investment. Banks begin to acknowledge that climate change, through new regulatory frameworks and costs incurred by clients, might have an impact on their business. Also, they realise that acting on climate change is important for their reputation and that there are profits to be made in green industries. However, market mechanisms and traditional business models alone will not stop all investments that harm the climate. International commercial banks should therefore consult with civil society organisations and other stakeholders and commit to:
end all support for activities that substantially contribute to climate change such as coal, oil and gas extraction and delivery or coal-fired power plants
reduce the climate impact of all lending and investment activities
support technology that reduces greenhouse gas emissions
promote renewable energy production and energy efficiency
develop products and services to help retail customers to address climate change, e.g. by buying climate efficient real estate
This will substantially change the banking business, but is necessary given the scale of the threat posed by climate change.