Canada’s largest bank is over a quarter of the way to reaching its $100-billion target for sustainable financing by 2025, according to its report on climate-related financial disclosure. “As Canada’s biggest bank, and one of the largest in the world based on market capitalization, we recognize that we have a role to play in accelerating the transition to a low-carbon economy and in mitigating the risks associated with climate change,” the report reads. About 4.6 per cent of RBC’s credit risk exposure in 2019 carbon-related. (The Logic)
Talking point: RBC has been carbon neutral since 2017, having rolled out emission-reduction programs and offset its carbon output by purchasing credits. That same year, it started considering climate change as a risk to its business and began tracking and disclosing it across its portfolio. Disclosure is now the norm among financial institutions in Canada—all the Big Six banks, along with the biggest pension funds, support the Task Force on Climate Related Financial Disclosure (TCFD), a global standard for tracking and reporting climate risk on businesses. Still, many firms have been slow to meaningfully change their practices to address climate change. The TCFD’s 2019 status update found just 25 per cent of companies that committed to the guidelines complied with more than five of its 11 recommended disclosures. RBC, for its part, has set targets for five of the nine climate-related metrics it reported for 2019.