(Reuters) — Major U.S. banks have threatened to leave the United Nations climate finance alliance because of legal risks, the Financial Times reported on Wednesday, citing several people involved in internal talks.
Morgan Stanley, JPMorgan and Bank of America are among the banks considering an exit because they fear being sued over the alliance’s strict carbon emissions commitments, the report said.
The Glasgow Financial Alliance for Net Zero, established in 2021 by former Bank of England Governor Mark Carney, is a coalition of asset managers, banks and insurers representing $130 trillion in assets targeting climate change.
Some members of the alliance have recently said they “feel blindsided by tougher UN climate criteria and are concerned about the legal risks of participation,”; the report said.
JPMorgan declined to comment, while Morgan Stanley, Bank of America and GFANZ did not immediately respond to Reuters requests for comment outside business hours.
Banks’ legal departments are particularly concerned about US Securities and Exchange Commission (SEC) rules around climate risk disclosure, the report said. The SEC will soon require formal disclosures in annual reports on governance, risk management and strategy with respect to climate change.
The banks have also complained that the demands placed on them are not supported by enough government action against climate change.
GFANZ has previously said it plans to release a series of frameworks, white papers and other guidance to help its members achieve their climate goals as they prepare for the next UN climate summit in Egypt in November.