Commerzbank pushes for coal phase-out by 2030
Clean Energy Wire
As part of its efforts to achieve a coal phaseout in Germany by 2030, Commerzbank is introducing a number of measures aimed at decreasing business linked to fossil fuels. From 1 January, Commerzbank will no longer enter into business relationships with companies that generate more than 20 percent of their sales or power generation with coal or with firms planning to expand oil and gas activities. The bank said it was focusing on investments that support the Paris Agreement climate target as it pushes for a sustainable transformation of the real economy. “With the new policy, we are taking another major step towards net zero,” said Commerzbank Chairman Manfred Knof. “We are underscoring our commitment to channelling investment flows towards the Paris climate target and pushing ahead with the transformation.” Commerzbank has already reduced its coal portfolio by half in just two years, Kopf added. The lender’s coal portfolio is currently valued at approximately €1 billion – about 0.2% of the bank’s total portfolio. Companies will have to substantially reduce their ties to the coal sector beginning next year. Commerzbank clients that currently use coal to generate 20 percent or more of their sales or power production have time until 2025 to draw up a plan to exit coal no later than 2030, the company said. The bank said it would support clients in transforming their business models but would terminate the business relationship if it determines that necessary efforts toward greater sustainability are not being made.
Commerzbank’s shift towards more sustainable investment comes in the wake of a damning report by NGO Finanzwende that found that many so-called sustainable funds were not in fact investing in climate-friendly activities. It is calling for a strict European standard that sets a common definition for sustainability in investments to remedy the situation.