Citi promise $100 billion to battle climate change
The US bank Citigroup will commit $100 billion to tackle climate change over the next ten years.
America’s third-largest financial institution, Citigroup, has promised to invest $100 billion over the next decade to fund environmental projects and battle climate change.
It’s the latest commitment from Citigroup and double the size of its similar goal from 2007, where the company pledged to make $50 billion in green investments by 2016 - a goal which only took three years.
"Citi has demonstrated its deep commitment to not only taking environmental consequences into account, but also finding innovative ways to finance projects that lead to sustainable growth," said Michael Corbat, chief executive officer of Citi.
“Incorporating the principles of sustainability into everything we do improves our own operations, enhances our clients' work, and contributes to a better world."
Investment in sustainability grows, but is it not-for-profit?
Citi’s strategy is increasingly focusing on environmental sustainability and as such its investments into this sector have been rising over the last few years. The company’s sustainability financing more than double between 2008 and 2013, rising from $4.29 billion to $8.78 billion, according to the group’s global citizenship report.
The newly promised funds are expected to go towards financing large renewable-energy projects - which it hopes will help reduce greenhouse gas emissions - and to resource efficiency in other sectors, such as sustainable transportation. Further initiatives that will receive investment will be those focused on water waste management and greener affordable housing.
Citigroup is not the only large bank that has been investing in the sustainable sectors in recent years, similar schemes have come from Bank of America, Wells Fargo and Goldman Sachs. Collectively, these banks have committed over $100 billion to invest in environmental and sustainable initiatives. However, many experts are questioning whether this is a real interest in repairing the environment or yet another bid to make money.
“This is not $100 million, it’s $100 billion. That’s a lot of money and what that says to me is that Citibank thinks there’s actually money to be made here,” said Rick Newman, a columnist on Yahoo Finance.
Boost for public image
Increasing pressure from the world and perhaps more importantly the client-base is likely one of the main driving forces behind the move towards sustainability. There is significant momentum from the demands of the public and institutions that show willing send a strong signal to clients.
It will go a long way to repairing the reputations of large institutions that have previously invested in environmentally damaging fossil-fuels and is potentially a consequence of the Valdez Principles, a ten-point environmental code for corporations that resulted from the high-profile oil Exxon oil tanker spill in 1989.
"The financial services industry has a big role to play in scaling up global clean energy investments, and we applaud Citi's leadership as the company continues to innovate and expand its efforts," said Mindy Lubber, president of the sustainability nonprofit group, Ceres.