The Net Zero Banking Alliance (NZBA) was created with the ambition of becoming the global standard for climate-conscious banking. It has ended its life as an abandoned framework, a collection of documents with no organization to support them, following a shutdown forced by a mass member exodus.
The ambition was to create a single, credible standard that banks around the world could adopt to guide their transition to net zero. With the backing of the UN and a membership of nearly 150 banks, it seemed for a time that this goal was within reach.
However, the standard proved to be no match for the political pressures of the real world. The re-election of Donald Trump and the rise of an “anti-woke” movement in the US led to a rejection of this global standard by its most important would-be adherents.
The abandonment began with the six largest US banks, who chose to walk away from the framework they had previously endorsed. Their departure was a fatal blow to the NZBA’s ambition of becoming a universal standard.
This was followed by the departure of other key international banks like HSBC and Barclays, leaving the framework effectively orphaned. While the documents remain publicly available, a standard that has been abandoned by the industry’s most powerful players has little chance of becoming the global norm. The NZBA’s fall from a potential standard to an abandoned framework is a cautionary tale for all such voluntary initiatives.