Morgan Stanley has announced its decision to withdraw from the Net-Zero Banking Alliance (NZBA), a coalition of banks committed to achieving global net-zero goals through financing activities. Despite leaving the alliance, the firm reaffirmed its commitment to its climate goals, including its ambition to achieve net-zero financed emissions by 2050.
A spokesperson for the company stated, “Morgan Stanley has decided to withdraw from the Net-Zero Banking Alliance. Morgan Stanley’s commitment to net-zero remains unchanged.”
This development is part of a series of recent exits from the NZBA by major financial institutions. Several banks have withdrawn in recent weeks, including some of the largest global firms.
The NZBA was established to encourage banks to align their financing activities with pathways to net zero by 2050. Members are expected to set interim targets for 2030, focusing on reducing financed emissions in high-impact sectors such as energy, transportation, and heavy industry.
Rising Pressure on Climate-Focused Alliances
The recent departures from the alliance coincide with increasing pressure on financial institutions from critics of climate-related commitments. Some political groups have raised concerns about legal risks associated with participation in such alliances. This broader opposition has led to challenges for banks navigating between climate goals and external pressures.
Morgan Stanley’s Net-Zero Journey
Morgan Stanley set its first net-zero financed emissions target in 2020, aiming for significant reductions by 2050. The firm has since outlined interim reduction targets for emissions-intensive industries, supporting its clients with advisory and financial services to decarbonize operations.
Recently, the company adjusted its interim targets, citing an assessment that the global economy is not on track to meet the 1.5°C temperature limit outlined in the Paris Agreement. The firm continues to focus on real-economy decarbonization, providing capital and advice to help clients transition to low-carbon business models.
“We aim to contribute to real-economy decarbonization by providing our clients with the advice and capital required to transform business models and reduce carbon intensity. We will continue to report on our progress as we work towards our 2030 interim financed emissions targets,” the spokesperson stated.
Morgan Stanley remains committed to advancing its sustainability objectives while navigating the evolving landscape of climate action and financial responsibility.