How are banks and insurance companies responsible for the climate crisis?
Banks and insurance companies are among main culprits of the climate crisis. Although they have had enough information on climate change, its threats and the urgency to come up with solutions, they still continue using their resources to sustain the fossil industry and support its expansion. Without their loans, insurance coverage and other services, energy corporations would not have enough money to expand fossil projects and manage risks related to this business.
How much do banks and insurance companies contribute to the climate crisis?
In the five years since the Paris Agreement, the world’s 60 biggest banks have financed fossil fuels (i.e. coal, oil and gas) with 3,8 trillion USD as reported in the Banking on climate chaos report. The Ceres and Unfriend Coal report estimates that the biggest U.S. and European insurance companies cover fossil infrastructure worth up to 600 billion USD. According to the International Renewable Energy Agency, investments in renewables between 2016 and 2050 are expected to reach 27 trillion USD. Divesting from the fossil industry would thus largely contribute to decarbonization.
Is your initiative only about pushing insurers and banks towards more ethical policies?
Our campaign focuses on banks and insurance companies as organizations that keep the fossil business running. We also promote imposing regulations on the financial sector so that private banks and insurance companies could not continue supporting fossil corporations. Rather than investing in dysfunctional economy of the past which has destroyed our planet and only served the few richest ones, funding needs to be provided for clean and fair economy of the future for everyone. The current crisis is an opportunity for this switch.
Why are you against gas?
Fossil gas used to be perceived as a transitional fuel for energy transformation. However, greenhouse gas emissions related to fossil gas are significantly growing, as evidence by the Oil Change International study. It is mainly caused by methane leaks during extraction and transport. According to a UN study, production of gas must be reduced by 3 percent per year globally. Transitioning from coal to gas is just an attempt of the waning fossil business to maintain its enormous profits. Investing in new fossil gas infrastructure is a deadlock, not a solution to the climate crises, and financial institutions should cease to support it.
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