The BBVA unit thus becomes the first and only Turkish bank to join the Net-Zero Banking Alliance (NZBA), which was launched in April by the United Nations Environment Programme Finance Initiative (UNEP-FI).
The agreement, which adds to the BBVA Group's adherence to this global initiative, will allow Garanti BBVA to take an important step in line with its undertakings in the fight against climate change in the Turkish banking sector, where it places sustainable finance at the center of its strategy. Garanti BBVA is also the first and only Turkish signatory to the NZBA, an initiative that encourages the mobilization of the financial system in attaining the objectives of the Paris Agreement.
The alliance represents a historic step forward for the banking sector's contribution to the fight against climate change and is the largest global initiative that unites banks under the commitment to zero net emissions.
Garanti BBVA has been committed to sustainable development and the fight against climate change and inequality for more than 15 years, and is a leader in Turkey thanks to its innovative financial models. In 2020, it was the first to announce its total emissions reduction target, in line with the 1.5°C target of the science-based target methodology (SBT). It also committed to reducing Scope 1 and 2 emissions by 29 percent by 2025 and 71 percent by 2035.
Recep Baştuğ, CEO of Garanti BBVA, explained that banks play a very important role in the fight against climate change, and the formation of NZBA is a historic step to drive global and coordinated action. “We are proud to be the 54th member of the NZBA, the strongest committed group in the global banking sector, as well as the first bank in our country to join the initiative and to develop strategies to achieve a net zero carbon portfolio by 2050.”
The executive recalled that in 2020, after reducing emissions from its activities by 75 percent compared to the baseline year, they purchased carbon credits for the remaining emissions. “We are, therefore, a carbon neutral bank and we already met the target set for 2035 15 years ago. Additionally, we have been the first to move towards phasing out coal in Turkey by not financing investments related to coal-fired power plants and mines,” Baştuğ added.
According to Garanti BBVA's CEO, BBVA's Turkish unit is following global trends to be a net zero emissions bank. “By joining the alliance for a net-zero emissions future, we show that our commitment to fighting the climate crisis is strong. We are aware of our responsibility as a bank to address the climate crisis and we are proud to represent our country on this international platform,” he said.
The NZBA was founded as a part of the Glasgow Finance Alliance for Net Zero Emissions at the 26th United Nations Climate Change Conference (COP26), to be held in November this year. The initiative involves 53 banks from 27 different countries, representing nearly a quarter of the world's banking assets (over $37 trillion), which have pledged to align their lending and investment portfolios with the goal of achieving net zero emissions by 2050.
What is COP26?
The United Nations Climate Change Conference (COP26) will be held from November 1-12 in Glasgow, Scotland's largest city. COP stands for "Conference of the Parties". The annual summit gathers 197 countries and serves as a platform for debate on climate change and strategies to combat the problem. The various COP meetings are organized under the United Nations Framework Convention on Climate Change and have been held since March 21, 1994, when the UNFCCC, the first intergovernmental convention on global warming, first entered into force.