Major banks are unexpectedly getting rid of a critical position across the industry: 'It's a tough time'

Sustainability staff were becoming commonplace at big banks, but a new trend is emerging that shows many are disinvesting from filling these crucial roles, according to the Financial Times.

What's happening?

The jobs that have been cut or reshuffled include staff members who were tasked with lowering banks' environmental impacts, as well as those who helped seek out eco-friendly capital to gradually wean the institutions' portfolios away from dirty energy investments. The banks making the changes include Wells Fargo, Barclays, Standard Chartered, and HSBC, the Financial Times reported.

Despite the recent expansion of such positions, this new downward trend is clear. As the outlet explained, it's a result of roadblocks slowing down climate action, as well as backlash from Republican politicians in the U.S.

These four banks have laid off senior officials and often not replaced them with anyone new afterward. Meanwhile, they have steadily downsized many sustainability departments.

"It's a tough time to be in the business," one chief sustainability officer said, per the Financial Times. "It's really hard."

Why are sustainability job cuts important?

According to the Financial Times, many in the banking sector say the cuts are just strategic consolidations meant to bring sustainable practices closer to companies' cores. 

Yet it's hard not to see it all as a telltale case of greenwashing. Banks letting this workforce go is an act that shows their true intentions. These institutions talked the sustainability talk but are caving as political headwinds shift. 

That's not to say their work was for nothing. For example, in 2022, HSBC became one of the first big banks to cut direct ties with new oil and gas financing and push to see eco-friendly plans from its energy clients. The bank was also gearing up to tackle the impact of who it lends to in new ways this year and had set a goal to fully offset its own supply chain's pollution by 2030, per the outlet.

However, that goal is now pushed to 2050, and similar initiatives at other banks are being put in jeopardy as the sustainability workforce is slashed.

What's being done to support sustainable banking?

For what it's worth, these institutions' hands are not tied. Standard Chartered chair José Viñals explained that the bank still has targets to cut down its oil and gas lending and has made nearly $1 billion in sustainable finance income, per the Financial Times. 

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Yet most big banks are sitting back to see how the Trump administration handles climate policy and how the world markets respond. Others point the blame at clients for a slow transition to clean energy. 

Either way, you can contact your U.S. representatives and use your voice to advocate for the importance of hiring people in any industry who help make it cleaner and safer for all.

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