JPMorgan Chase said Thursday it will allocate more than $ 2.5 trillion over the next decade to long-term solutions that address climate change and contribute to sustainable development.
The initiative allocates $ 1 trillion to green projects, including renewable energies and clean technologies, to accelerate the transition to a low-carbon economy.
The $ 2.5 trillion goal, which starts this year and runs through the end of 2030, will also fund and facilitate transactions that support socio-economic progress in developing countries, as well as economic inclusion in developed countries.
The latter efforts focus on small business finance, home loans and affordable housing, education and health care. That category includes the $ 30 billion JPMorgan pledged last October to fill the racial wealth gap in the United States
“Climate change and inequality are two of the most critical issues of our time, and these new efforts will help create sustainable economic development that leads to a greener planet and critical investments in underserved communities,” said CEO Jamie Dimon.
“Business, government and political leaders must work together to support long-term solutions that promote economic inclusion, promote sustainable development and promote the transition to a low-carbon economy. We are determined to do our part,” he said.
Thursday’s announcement comes after JPMorgan announced last fall that it would set emissions targets for its funding portfolio. The company said the targets would be set by sector and would initially focus on the oil and gas, power and auto manufacturing sectors.
The targets that the company has announced for 2021 will be within the parameters set out in the 2015 Paris Agreement.
In his 2020 annual letter to the shareholders, Dimon also addressed the enormous opportunities that arise from the energy transition.
“Sustainable and low-carbon technologies and businesses offer tremendous opportunities,” he said.
“While many of these technologies and companies are mature, many are just beginning – and more will need to be created in the decades to come. In addition, all companies need capital and advice to innovate, evolve and become more efficient while in one to remain competitive in the changing world, “Dimon said in the letter.
The bank enabled more than $ 220 billion in sustainable development-related transactions in 2020, of which more than $ 55 billion was for green initiatives. The grand total exceeded the company’s original annual target of $ 200 billion.
Some believe the bank hasn’t done enough.
A recent report by a collection of climate organizations found that JPMorgan’s total fossil fuel funding from 2016 – the first full year after the Paris Agreement was signed – was $ 317 billion. That is more than any of the major banks.
Citi and Wells Fargo were the second and third largest financiers at $ 237 billion and $ 223 billion, respectively.
While JPMorgan is still high on the list, the bank – the largest of the assets under management in the US – has cut its lending since it signed the Paris Agreement, the report said.
A company representative previously said the bank would not comment on reports from third parties.
Citi also announced lofty sustainable funding goals on Thursday, saying it will provide $ 1 trillion by 2030.
“We will fund and enable a wide range of climate solutions – from renewable energies and clean technology, to water conservation and green buildings, to sustainable agriculture and land use – and further accelerate the transition to a sustainable, balanced, low-carbon economy , social and economic needs of society, “said the bank in a blog post.
– CNBC’s Hugh Son contributed to the coverage.
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