Big Banks Break Their Climate Promises by Propping Up Big Meat
From The Observatory
As worries about climate change grow, banks in the United States are under pressure to reduce greenhouse gas emissions linked to their loans and investments. Many large banks have promised to cut back on funding high-emitting industries to help reach net-zero goals. Despite this, they still finance industries that are major polluters, which threatens global climate targets.
Investing in industries that harm the climate is also risky for banks and investors. In a 2020 letter, Larry Fink, CEO of BlackRock, warned that climate change impacts could hurt investments. This includes physical impacts (like rising costs and disrupted supplies) and policy impacts (as climate regulations change economic dynamics).
Banks must do more to cut the climate impacts of their investments. Industrial livestock farming is a significant source of emissions, yet banks haven’t made major changes in this area. Reducing financial support for industrial livestock could significantly help banks achieve their emissions goals.
Industrial livestock farming contributes up to 19.6 percent of global emissions. Without capping these emissions, it will be extraordinarily difficult to keep global temperature rise below 1.5 degrees Celsius. The industry’s emissions come from various sources, including methane from cows, feed production, manure management, and deforestation. This sector also causes animal cruelty, environmental damage, health problems, and labor rights violations.
Banks like Bank of America, Citigroup, and JPMorgan Chase are major financiers of the meat, dairy, and feed industries. These industries produce high emissions, with livestock finance generating significantly more emissions per dollar than other sectors. In 2022, these three banks’ financing led to 24.4 million metric tons of CO2-equivalent emissions, comparable to burning 27.3 billion pounds of coal.
To meet climate commitments, banks need to stop financing the expansion of industrial livestock production, require clients to set emission-reduction targets, and address the broader environmental and social harms of industrial livestock farming. This shift is crucial for reducing emissions and achieving sustainable food systems.
Read the full article “Big Banks Break Their Climate Promises by Propping Up Big Meat” by Monique Mikhail and Ward Warmerdam
🔭 This summary was human-edited with AI-assist.
