The Institutional Investors Group on Climate Change (IIGCC), in consultation with the Transition Pathway Initiative Global Climate Transition Centre (TPI Centre), has launched a Net Zero Standard for Banks setting out investor expectations on the transition to net-zero.

The Standard is built around the ten areas: bank commitments; targets; exposure and emissions disclosure; emissions performance; decarbonisation strategy; climate solutions; policy engagement (lobbying); climate governance; just transition; and annual reporting and accounting disclosures; and complements the Net Zero Investment Framework (NZIF).

The Standard is intended to support constructive engagement with banks to aid ongoing implementation of climate commitments. Where necessary, it will continue to evolve and be refined to reflect relevant developments, including new methodologies, policy and regulation. Over 25 investors, including Amundi, Legal & General Investment Management, Nest Corporation, Schroders and Fidelity International have contributed to the development of the Standard.

Alongside the Standard, the TPI Centre has launched a Net Zero Banking Assessment Framework, which is a set of measurable indicators, sub-indicators, and scoring guidance for assessing the alignment of banks against the goals of the Paris Agreement.

The TPI Centre will use the Net Zero Banking Assessment Framework to assess 26 global banks across Europe, North America and Asia annually, with the inaugural assessments due for publication in summer 2023. As well as highlighting areas for improvement, the assessments will capture the progress many banks have made to date and the ongoing implementation of their stated climate-related policies and plans.

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