Goldman Sachs to Move Funding Away from Coal, Arctic Oil
U.S. investment bank Goldman Sachs announced policies on Sunday that will restrict its funding of coal, end direct funding of Arctic oil and gas projects and increase funding for sustainable projects.
The company said in its policy framework: “We take seriously our responsibility for environmental stewardship and believe that as a leading global financial institution we must play a constructive role in helping to address environmental challenges.” The framework recognizes climate change is one of the most significant environmental challenges of the 21st century, which is also linked to other important issues, including economic growth and development, poverty alleviation, access to clean water, food security and adequate energy supplies.
The company will expand its clean energy target to $150 billion in financing and investments by 2025 to facilitate the transition to a low-carbon economy.
It will decline any financing that directly supports the development of new coal fired power generation unless it has carbon capture and storage or equivalent carbon emissions reduction technology. This applies globally in both developed and developing economies.
It will also decline any financing transaction that directly supports new upstream Arctic oil exploration or development. This includes but is not limited to the Arctic National Wildlife Refuge.
The company will not finance any projects or initiate loans where the specified use of proceeds would significantly convert or degrade a critical natural habitat.
Regarding human rights, the company says it will not knowingly finance any potential transactions where there is credible evidence of child labor, forced labor or human trafficking.
Danielle Fugere, President of As You Sow, said this about the announcement: “We welcome this announcement as an important step in what we hope will be stronger action by Goldman Sachs and other U.S. banks to limit funding of fossil fuel projects and companies. As climate impacts continue to ravage the global economy, banks must take responsibility for their role in funding fossil fuel development that drives global temperature increases. We support Goldman’s leadership.”