Bank of America announces goal of net zero by 2050
Building on Bank of America’s longstanding support for the Paris Climate Agreement, the company today outlined initial steps to achieve its goal of net zero greenhouse gas (GHG) emissions in its financing activities, operations and supply chain before 2050.
Bank of America continues to actively engage with its clients to help accelerate their own transitions to net zero, and it plans to establish interim science based emissions targets for high-emitting portfolios, including energy and power. In addition, Bank of America released its broader 2030 operational and supply chain goals as part of a holistic commitment to environmental sustainability.
“It is critical that we leverage all parts of our business – beyond our direct operations – in order to accelerate the transition to a net zero global economy,” said Bank of America Vice Chairman, Anne Finucane, who leads the company’s environmental, social and governance, sustainable finance, capital deployment, and public policy efforts. “We recognize that this will be no easy task, but we believe our commitment will help spur the growth of zero carbon energy and power solutions, sustainable transportation and agriculture, and other sector transformations, while generating more climate resilient and equitable opportunities for our future.”
Collaboration on the Path to Net Zero
As part of its transition to net zero emissions, in July 2020, Bank of America joined the Partnership for Carbon Accounting Financials (PCAF) as a member of the Global Core Team. In collaboration with 15 other financial institutions, Bank of America participated in the development of the Global GHG Accounting and Reporting Standard for the Financial Industry, providing a consistent methodology to assess and disclose emissions associated with financing activities. Bank of America is committed to disclosing its financed emissions no later than 2023.
This collaboration builds on Bank of America’s ongoing and recent efforts with partners to address the financing, technology, policy and other challenges inherent in the transition to a net zero global economy, including:
CEO Brian Moynihan serves as co-chair of His Royal Highness The Prince of Wales’ Sustainable Markets Initiative.
The World Economic Forum’s International Business Council, under Moynihan’s chairmanship, recently released a set of common Environmental, Social and Governance (ESG) Stakeholder Capitalism Metrics, developed in conjunction with the Big 4 Accounting Firms. Nearly 70 global companies have committed to the metrics, which include recommendations of the Task Force on Climate-related Financial Disclosures, as well as alignment with net zero emissions before 2050. Moynihan is also a member of the World Economic Forum’s Alliance of CEO Climate Leaders and its Transition Finance Steering Committee.
Bank of America is also a founding partner of RMI’s Center for Climate Aligned Finance, and members of 1t.org U.S. Stakeholder Council and Energy Transitions Commission.
Bank of America routinely engages members of its National Community Advisory Council – including Ceres, the Center for Climate and Energy Solutions (C2ES), Clean Air Task Force, The Nature Conservancy, World Resources Institute, and U.S. Green Building Council – and other external stakeholders, to provide valuable perspective and guidance in shaping its net zero strategy and planning.
“By outlining the steps Bank of America is taking to achieve net zero emissions, the company is accelerating the ambitions laid forth in the Paris Climate Agreement,” said Ceres CEO and President Mindy Lubber. “As a global financial institution, Bank of America has unique influence and reach to help achieve those goals. We appreciate Bank of America’s commitment to set ambitious 2030 targets and look forward to more details in the future, including how it will work with clients to deliver on its commitment.”
Expanding Operations and Supply Chain Commitment
Bank of America achieved carbon neutrality in its operations in 2019, a year ahead of schedule, and increased the number of vendors that measure and publicly report GHG emissions through the CDP Supply Chain survey. Bank of America has now established the next set of targets for its operations and supply chain to be achieved by 2030:
Maintain carbon neutrality for operations (Scope 1 and 2).
Purchase 100% zero carbon electricity.
Reduce location-based GHG emissions by 75% (Scope 1 and 2).
Reduce energy use by 55%.
Reduce potable water use by 55%.
Manage facilities responsibly and achieve LEED® certification (or comparable) for 40% of building space.
Responsibly manage waste to reduce amount sent to landfill.
Divert 75% of construction and demolition waste from the landfill.
Dispose 100% of electronic waste using certified responsible vendors.
Ensure 70% of global vendors, by spend, set GHG emissions reduction or renewable energy targets.
Assess 90% of global vendors, by spend, for ESG risks as outlined by the company’s Vendor Code of Conduct.
Continue to reduce paper use and purchase 100% of paper from certified sources.
Deploying Capital to Low-Carbon, Sustainable Business Activities
Significantly increasing investment in the low-carbon technologies and activities needed to decarbonize all sectors of the economy will be critical to Bank of America meeting its net zero goals. Since 2007, the company has directed more than $200 billion in capital and has committed to deploy a total of $445 billion by 2030 under its Environmental Business Initiative. The company already expects to exceed this commitment in advance of 2030 based on current financing activity. Under this initiative, the company partners closely with its clients to finance the adoption of low-carbon solutions, including resource-efficient building construction, renewable energy, sustainable transportation such as electric vehicles and charging infrastructure, and resource-efficient agriculture.
Bank of America is also dedicating significant financial, intellectual, philanthropic and catalytic capital to support the advancement of developing technologies, such as carbon finance, sustainable agriculture and biofuels, water infrastructure, clean hydrogen, waste-to-energy, and carbon capture sequestration technologies. More details on Bank of America’s approach to addressing climate change and managing risk in its financing activities can be found in the company’s updated Environmental and Social Risk Policy Framework and Task Force on Climate-related Financial Disclosures Report.