JPMorgan Chase said Tuesday that it’s committing $200 billion in financing this year to expand its sustainability goals, which include imposing restrictions on lending to coal mining companies and ending direct funding of Arctic drilling projects.
The bank said it will no longer lend to capital markets or give advisory services to companies that get a majority of their revenues from coal extraction. By 2024, the bank said it will phase out its remaining credit exposure to those businesses.
The financial firm will also cap funding for any new coal power plant “unless it is utilizing carbon capture and sequestration technology.” Additionally, the bank said it will no longer finance new oil and gas projects in the Arctic.
JPMorgan Chase has often drawn the ire of climate activists, who argue that the second largest global bank—with $2.7 trillion in assets—has remained the biggest funder of fossil fuels.
Environmental groups point out that the commitment closely mirrors similar pledges recently made by European banks and Goldman Sachs, which have also restricted funding for coal, oil, and gas. Climate advocates argue that the targets may be too small.
The restriction “is a long-awaited signal that JPMorgan Chase may be ending its outsized level of fossil fuel financing in the face of growing climate concern,” Danielle Fugere, president of shareholder advocacy group As You Sow, said in a statement.
“Yet, JPMorgan has not agreed to bring its full carbon footprint into alignment with the Paris goal. Until it agrees to do so, its fossil fuel funding remains a clear threat to the global goal of avoiding catastrophic warming,” Fugere added. In 2016, the Paris Agreement set a global target to bring greenhouse emissions to net zero by 2050.
Previously, the bank in 2017 set a $200 billion clean financing target for 2025, as well as a commitment to source renewable energy for its global power needs by this year. The firm said it will meet both targets.
A quarter, or $50 billion, of this year’s commitment will also satisfy the 2017 clean financing goal, which goes toward projects such as clean water and health care initiatives in the developing world.
Other commitments include an increased focus on environmental, social, and governance (ESG) solutions, such as a group to advise clients on how best to reduce their carbon emissions. The bank plans to create ESG indexes focused on fixed income.