Wells Fargo formally left the Net-Zero Banking Alliance (NZBA), making it the second large US bank to take a step away from the UN-backed coalition working on global net-zero emissions through funding activities. The move has been made by Wells Fargo following a similar departure in December by Goldman Sachs. NZBA was formed back in 2021, with over 140 banks from 44 countries representing approximately $73 trillion in assets. Its members commit to aligning operational and financed greenhouse gas (GHG) emissions with net-zero pathways by 2050, setting interim 2030 targets for emissions-intensive sectors such as oil and gas, power, automotive, steel, and aviation. The alliance recently expanded its guidelines to include capital markets activities, such as debt and equity underwriting, in its climate commitments.
Wells Fargo became a member of the NZBA in October 2021, after setting its own climate targets in early 2021, which include achieving net-zero GHG emissions across its operations and financed activities by 2050. The bank has removed its membership from the alliance but kept its net-zero targets on its website, as well as its interim reduction targets for key industries. Wells Fargo’s move is a part of a bigger trend of exits from climate-focused coalitions under the Glasgow Financial Alliance for Net Zero (GFANZ), an umbrella organization for financial sector groups committed to climate action. GFANZ also includes initiatives such as the Net Zero Asset Managers (NZAM), Net Zero Asset Owner Alliance (NZAOA), and the Paris Aligned Asset Owners (PAAO). Earlier this year, another GFANZ group called the Net Zero Insurance Alliance (NZIA) disintegrated under heavy political and legal pressure.
The NZBA had largely avoided any big-name exits until recent times. Republican politicians in the U.S. have been increasingly scrutinizing banks that are part of these climate-focused alliances, suggesting that they are violating legal obligations and are more focused on climate agendas than business interests. Texas Attorney General Ken Paxton has claimed victory as Wells Fargo announced it will be leaving the state due to his office’s examination of the bank as a boycotter of energy firms. In a statement about the NZBA, which he described as an “anti-energy activist organization”, Paxton said: “It is a great win for Texas that Wells Fargo left the state.”. He further claimed that the bank’s exit followed his request in August, citing concerns over the legality of ESG commitments.
The NZBA, while expressing regret over the decision, emphasized its continued relevance and growing membership, noting that more than 100 banks across 35 countries have joined since its inception. According to an NZBA spokesperson, the alliance has been a critical platform of understanding climate risks and how the world can transition together towards net-zero emissions. Although the spokesperson admitted that the five banks, such as Wells Fargo, have stepped down since the founding, he pointed out that in total, membership has kept steadily increasing as evidence that the alliance is important.
Wells Fargo’s exit represents the deepening challenge facing financial institutions as they balance climate commitment with political and regulatory pushback, particularly in the U.S. With debates still raging over ESG policies and net-zero goals, the decision sends a powerful message about the complexity of maintaining unified global efforts on climate action.