New York City Comptroller Brad Lander announced agreements with three major North American banks, including JPMorgan Chase, Citi and RBC, to publicly disclose a new climate reporting metric outlining their ratios of clean energy to fossil fuel finance.

The new agreements follow the filing of shareholder resolutions in January by three of New York City’s pension funds – the New York City Employees’ Retirement System (NYCERS), Teachers’ Retirement System (TRS), and Board of Education Retirement System (BERS) – at JPMorgan, Morgan Stanley, Citi, Goldman Sachs, Bank of America and RBC, to require the banks to provide the new metric, aimed at ensuring that their financing activities align with their net zero commitments. The Comptroller is the investment advisor to and custodian of assets of the city’s pension funds.

JPMorgan, Citi and RBC have each made commitments to align their financing activities with net zero by 2050, as well as announcing goals to facilitate $2.5 trillion, $1 trillion and $500 billion of sustainable finance, respectively (by 2030 in the case of JPMorgan and Citi, and by 2025 by RBC).

In its statement announcing the filing of the resolutions, however, the Comptrollers office said that the pension funds were concerned about the banks’ continued high level of fossil fuel financing, citing a Bloomberg NEF study indicating that the ratio of clean energy to fossil fuel needed to hit climate goals would have to rise to 4:1 by 2030, compared to an average for North American banks in 2022 of 0.6:1.

Lander said:

“Despite their commitments to decarbonize, U.S. and Canadian banks have financed over $1 trillion of fossil fuel extraction since the Paris Accords. The transition from financing fossil fuels to low-carbon energy is going far too slowly – and thus far, it hasn’t even been possible for shareholders to track.”

Under the new deals, the three banks agreed that they would regularly disclose their clean energy to fossil fuel financing ratio, as well as their underlying methodologies.

After reaching its agreement with the pension funds, a JPMorgan Chase spokesperson said:

“We found common ground with NYC Comptroller on disclosing a clean energy financing ratio with an understanding that it is going to take us some time and resources to develop a decision useful approach. We will engage with NYC and our shareholders to provide the market more clarity and transparency about our activities and what financing the transition truly looks like.”

The shareholder resolutions are still in place with Bank of America, Goldman Sachs and Morgan Stanley, and the pension funds said that they will continue their engagements with these banks.

Lander said:

“We appreciate JPMorgan, Citigroup, and RBC agreeing to provide greater transparency so that long-term investors can more effectively measure how well they are or aren’t living up to their commitments. As leading public investors, we expect that energy supply ratio disclosure will become a new standard for the banking sector. We call on Bank of America, Goldman Sachs and Morgan Stanley to follow suit at a time when our planet and investment portfolios are at risk.”