The Net Zero Banking Alliance (NZBA), an organization that grew to include nearly 150 global banks at its zenith, has seen its membership and mission evaporate. The group has been forced to shut down immediately, marking the definitive collapse of a major voluntary climate initiative in the financial sector.
The unraveling was swift and was sparked by political events in the United States. The re-election of Donald Trump on a platform hostile to environmental regulation created a perilous landscape for US banks. A growing “anti-woke” movement among conservative politicians meant that membership in the NZBA was no longer just a climate commitment but a political statement that invited attack.
In a move that crippled the alliance, the six largest US banks withdrew their support in unison. This strategic exit, which included financial powerhouses from JPMorgan Chase to Morgan Stanley, was a direct response to the changing political winds. It also signaled a major retreat from collective, global climate action by the world’s most important financial market.
The departure of the US contingent left the NZBA on shaky ground. Its international members, including those in Europe and Japan, began to question the value of the alliance without its most powerful participants. The exits of HSBC and Barclays this summer were the final confirmation that the organization was no longer viable.
The end of the NZBA is being viewed through two different lenses. For some, it represents a failure of corporate will and a significant setback for the clean energy transition. For others, it’s the end of a charade. These critics argue the alliance was always more about public relations than substantive change, and its collapse now puts the onus squarely on governments to implement the tough regulations needed to steer finance away from climate destruction.