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Commitment> Climate Action 23 Jun 2023

BBVA renews its membership of the Net-Zero Banking Alliance Steering Committee

BBVA is repeating as the only Spanish bank on the Steering Committee of the Net-Zero Banking Alliance (NZBA). The bank has been a founding member of this alliance since April 2021. NZBA is a forum promoted by United Nations that defines the frame of reference for the decarbonization of the banking sector: a robust, science-based framework that underpins the credibility of the voluntary commitments.

BBVA renueva como miembro del comité directivo de la alianza bancaria de cero emisiones netas

The Net-Zero Banking Alliance is governed by a Steering Committee of 12 banks that supervise the decision-making and strategy. This committee is selected by all the member banks so that it is representative of the geographic diversity and business models.

The committee consists of two levels: a main level with delegates from the highest level of each organization (including Carlos Torres Vila, BBVA Chair), which ensures that the strategy is integrated into the heart of the organizations; and a representative level comprised of delegates from each bank, who address practical aspects in working groups in order to comply with the commitment of the alliance.

The Secretariat of the United Nations Environment Program Finance Initiative (UNEP FI) supports and convenes the alliance. Furthermore, United Nations also has a place on the steering committee.

Since it was established, the alliance has continued to grow. It currently includes 132 banks from 41 countries, which add up to 74 trillion dollars in total assets or 41 percent of global bank assets. BBVA (like all founding members) has committed to set intermediate decarbonization targets for 2030 and to reach the end goal of zero net emissions by 2050.

On April 12th, BBVA published the progress that has been made toward accomplishing the intermediate objectives in the following sectors: oil and gas, power generation, automotive, steel, cement in addition to advances in the progressive phase-out of the coal sector. The bank is one of the first in the world to apply the recommendations to define its transition plan according to the Glasgow Financial Alliance for Net Zero (GFANZ).

NZBA commitments and goals

The Net Zero Banking Alliance was born in the heart of the United Nations Environment Program Finance Initiative (UNEP FI) with the goal of providing legitimacy, credibility and transparency in the journey toward emission neutrality by 2050. Since its establishment in 2021, it allows the member banks to accelerate the development of tools and methodologies needed for this transition.

By signing to join the NZBA, banks agreed to define a set of targets for areas with the greatest impact - identifying carbon reductions in priority economic sectors; targets that are ambitious and in line with the most demanding scenario in the Paris Agreement; and targets that are based on science.

In its commitment statement, the NZBA expressly recognizes “the vital role of banks in supporting the transition of the real economy to net-zero emissions, but we will only succeed in achieving this objective if our clients and other stakeholders also play their part. We make this Commitment with the expectation that governments will follow through on their own commitments to ensure that the objectives of the Paris Agreement are met.”

In addition, the NZBA is part of the global campaign Race to Zero, backed by the UN. It is also responsible for the promotion and coordination of the Glasgow Financial Alliance for Net Zero (GFANZ) and the United Nations Principles for Responsible Banking.

Other European banks such as Standard Chartered, HSBC and La Banque Postale will also continue on the steering committee with BBVA for another year following the voting by 68 banks from the region that are members of the alliance. Globally, Amalgamated Bank, Bank of America, Banorte, CIB Egypt, Citi, KB Financial Group, Morgan Stanley and Mitsubishi UFJ Financial Group.

This is a key moment for the alliance, as it is updating the reference guide, which is expected to be published by April 2024. In November 2022, the NZBA published its first progress report since its launch in April 2021. The report aggregated the intermediate targets for 2030 established by more than 60 members (including BBVA) and reiterated its requests for support from policy makers to help ensure an orderly transition of the entire economy to net zero emissions. Over half of the banks that make up the alliance have set intermediate decarbonization targets.