Goldman Sachs has chosen to exit the Net-Zero Banking Alliance (NZBA), ESG Today has confirmed, marking the first high profile departure from the UN-backed coalition of banks dedicated to advancing global net zero goals through their financing activities.

In a statement provided to ESG Today, a Goldman Sachs spokesperson said that the firm has “the capabilities to achieve our goals and to support the sustainability objectives of our clients,” and added that it “is also very focused on the increasingly elevated sustainability standards and reporting requirements imposed by regulators around the world.”

Goldman Sachs also confirmed that its goal to align its financing activities with net zero by 2050, and its interim sector-specific targets remained in place.

Founded in 2021, the Net-Zero Banking Alliance is a coalition of 145 banks spanning 44 countries and representing approximately $74 trillion in assets. Members of the NZBA commit to transitioning operational and attributable greenhouse gas (GHG) emissions from their financing activities to align with net zero pathways by 2050, and to set 2030 financed emissions targets, initially focused on key emissions intensive sectors. Earlier this year, the group issued new guidelines for climate target setting for banks, expanding its requirements to include a commitment to align capital markets activities such as debt and equity underwriting to bank’s 2050 net zero goals, in addition to the prior lending-focused commitment.

The NZBA forms part of the Glasgow Financial Alliance for Net Zero (GFANZ), a UN-backed umbrella group of net zero-focused financial sector coalitions, which also includes the Net Zero Asset Managers initiative (NZAM), Net Zero Asset Owner Alliance (NZAOA), Net Zero Financial Service Providers Alliance (NZFSPA), the Net Zero Investment Consultants Initiative (NZICI), the Paris Aligned Asset Owners (PAAO), the Venture Climate Alliance (VCA), and the Net-Zero Export Credit Agencies Alliance (NZECA).

GFANZ had also previously included the Net Zero Insurance Alliance (NZIA), which was discontinued earlier this year, following a string of departures from the group, which had been under pressure from Republican politicians in the U.S., who have been warning financial institutions including insurers and asset owners of potential legal violations from their participation in climate-focused alliances.

As political pressure on the net zero-focused associations has continued to build, other GFANZ groups have also seen high-profile departures, although the NZBA had largely avoided this phenomenon until now. Goldman Sachs’ departure from the NZBA follows Goldman Sachs Asset Management’s (GSAM) decision earlier this year to end its participation in Climate Action 100+, an engagement-focused investor climate initiative that is also a key target for anti-ESG politicians.

Goldman Sachs announced a series of sustainability goals in early 2021, including a commitment to align its financing activities with a net zero by 2050 pathway. Notably, the firm set this goal prior to joining the NZBA in October 2021. Goldman Sachs also subsequently set interim financed emissions goals for carbon-intensive sectors, including Oil & Gas, Power, and Auto Manufacturing.

In the firm’s statement to ESG Today, Goldman Sachs noted that it has already made “significant progress” on its net zero goals,” and that it plans to expand its targets “to additional sectors in the coming months.”

The firm added:

“Our priorities remain to help our clients achieve their sustainability goals and to measure and report on our progress.”