What is the Net Zero Banking Alliance?
The Net Zero Banking Alliance (NZBA) is a global coalition of banks and lenders that are committed to supporting and aligning with the goals of the Paris Agreement on climate change by helping to finance the transition to a net zero carbon economy.

What is the Net Zero Banking Alliance?

The Net Zero Banking Alliance (NZBA) is a global coalition of banks and lenders that are committed to supporting and aligning with the goals of the Paris Agreement on climate change by helping to finance the transition to a net zero carbon economy.

This industry-led, UN-convened initiative represents nearly 40% of global banking assets. The NZBA is the flagship climate initiative under the Principles for Responsible Banking.

What’s the goal?

Banks that have pledged to the alliance are committed to aligning their lending and investment portfolios with net-zero emissions by 2050. In addition, signatories also commit to setting near-term targets for 2030 or sooner using robust, science-based guidelines.

Who does it apply to?

Banks (globally).

When does the Net Zero Banking Alliance come into effect?

The NZBA was founded in 2021. Once a bank signs the commitment, they have 18 months to set their targets.

Is it mandatory?

No.

How do you become compliant with the Net Zero Banking Alliance?

First, the commitment statement must be signed by the bank’s CEO. Once this is signed, the bank is committed to:

  • Transition the operational and attributable GHG emissions from their lending and investment portfolios to align with pathways to net-zero by 2050 or sooner.
  • Within 18 months of joining, set 2030 targets (or sooner) and a 2050 target, with intermediary targets to be set every 5 years from 2030 onwards.
  • Banks’ first 2030 targets will focus on priority sectors where the bank can have the most significant impact, ie. the most GHG-intensive sectors within their portfolios, with further sector targets to be set within 36 months.
  • Annually publish absolute emissions and emissions intensity in line with best practice and within a year of setting targets, disclose progress against a board-level reviewed transition strategy setting out proposed actions and climate-related sectoral policies.
  • Take a robust approach to the role of offsets in transition plans.

Source: UN (https://www.unepfi.org/net-zero-banking/commitment/)

How we can help

At Bloom, we offer advisory support and digital tools to help you meet your NZBA commitments.

Our carbon accounting tool can help measure your Scope 1, 2, and 3 emissions – even your portfolio emissions. Measuring the emissions in your portfolio can feel like a daunting task – what data you need, where to get it, and what methodology to apply.

We leverage the Partnership for Carbon Accounting Financials (PCAF) and can guide you along this journey.

There’s more where that came from!

Grab our newsletter so you don’t miss a post. We’ll share the most valuable tips and articles about how to become more sustainable.

You may also like…

What is SFDR?

What is SFDR?

SFDR requires fund managers to establish ESG investment principles, integrate sustainability risks, assess adverse sustainability impacts, and promote environmental or social characteristics.

What PCAF and CDP Data Quality Scores Mean

What PCAF and CDP Data Quality Scores Mean

The CDP (Carbon Disclosure Project) and PCAF (Partnership for Carbon Accounting Financials) have issued standards for organising and reporting data. What does that mean for your business?