Members of a UN-backed climate coalition have voted to tighten the guidelines for climate target setting for banks.

The Net Zero Banking Alliance (NZBA), which has 143 member banks, has updated its guidance, requiring banks to disclose more about how they plan to reduce carbon emissions, particularly from their capital market activities.

NZBA’s updated guidelines will also require data disclosure on policy engagement and transition planning.

Member banks, which oversee roughly $74 trillion (£58 trillion), have led a review of the guidelines since early 2023 ahead of NZBA’s three-year anniversary in April 2024.

A large proportion of the banks shared views on what an updated version might look like and to adopt the new guidelines, over 50% of members had to vote.

“NZBA is made up of more than 140 member banks of different sizes and business models operating in various jurisdictions and economies.

“The threefold increase in our membership since we were established in 2021 demonstrates the significance of climate change to banks operating all over the world. The updated guidelines will support our member banks as they manage climate-related risks and opportunities and support the transition of the real economy,” said NZBA Steering Group chair, Tracey McDermott.

The original version of the guidelines was published to coincide with NZBA’s launch on 21 April 2021. It details the commitment that each member bank chooses to make in relation to meeting climate goals.

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