Climate Action 100+ is — or was — the world's largest investor group against the changing climate. Major finance institutions joined with pledges to reduce their impact on the environment. But some institutions, including JPMorgan, have just left, Bloomberg reported.
What happened?
Climate Action 100+ recently announced a policy change that would require less talk and more action from members. JPMorgan left the organization shortly afterward.
JPMorgan didn't cite the change in direction as the reason for its departure and instead announced that it had started developing its own independent approach to protecting the environment, Bloomberg revealed.
However, another institution, BlackRock Inc., also made major changes in the wake of the decision. The subsidiary BlackRock International will now be a member of Climate Action 100+, but the parent company has left, specifically citing the climate organization's new policy.
According to Bloomberg, BlackRock Inc. announced that the pushier climate policy "would raise legal considerations, particularly in the U.S." That interpretation is likely related to JPMorgan's departure.
Why does this move matter?
In the past, companies have made ambitious promises about how they would protect the environment by changing their policies. If those goals had been achieved, they would improve living conditions for many, lower costs in some cases, and help correct the world's disastrous overheating issue.
However, there is nothing to hold these companies to their word, and many have abandoned their climate promises.
JPMorgan and similarly large financial institutions fund or back huge polluting industries worldwide. If they stopped financially supporting activities like oil drilling, they could cut pollution off at the knees. By backing out on their promises, they are seriously setting back the movement toward affordable energy and clean air.
According to Bloomberg, some see JPMorgan's departure from Climate Action 100+ as a sign that joining was greenwashing — a performance to get the business of eco-conscious consumers.
On the other side, Mark Campanale, founder and director of Carbon Tracker, told Bloomberg, "It's easier to go underground instead of showcasing big initiatives that draw the wrong attention. What we're seeing now is greenhushing."
In other words, firms will keep helping the environment — they'll just do it quietly for fear of backlash.
What can we do about broken climate promises?
Individuals can switch to a trustworthy green bank and eco-friendly investments. If enough people move their money, it could send a clear message to firms that they should get serious about their climate commitments.
Beyond that, Lucie Pinson, executive director at nonprofit Reclaim Finance, told Bloomberg that industries won't become eco-friendly without regulation.
"Without regulation, catastrophic financial risks for the global economy and intolerable impacts for the millions of people on the front lines of climate change can be expected," she said.
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