The corona virus, which has been the problem of the whole world in recent years, has once again revealed the importance of the concepts of climate change and sustainability. It has been observed how fragile many companies that are thought to be very strong can actually be, or that the economies of countries can be damaged in this process. With the pandemic, the problems caused by the climate crisis have come to the fore even more. As Bill Gates put it, “There is a vaccine to beat the corona virus, but there is no vaccine to beat the climate change problem”. In this context, banks have important responsibilities.
The financial sector, which is the locomotive of the growth of the country's economies, has a privileged position with its critical role in the allocation of economic resources. In this process, on the one hand, it has to manage environmental risks; on the other hand, it tries to limit negative externalities and create positive externalities by allocating resources to the right areas. The climate crisis triggers a new economic understanding and transformation. Transformation and change have become necessary for financial survival, as well as contributing to the image of companies. It has been observed that companies that include the climate crisis in their strategies are one step ahead of the competition. However, while only eight of their banks in Turkey have declared that they will finance coal, other banks do not make such a statement. In the 5 years since the Paris Agreement, 60 of the world's largest banks have financed fossil fuels worth $3.8 trillion. Illegal financing for fossil fuel extraction and infrastructure is fueling climate chaos and threatening the lives and livelihoods of millions of people.The increase in natural disasters in recent years, the melting of glaciers, sudden changes in weather events, and the damage caused by these events emphasize that urgent measures should be taken in this regard.
Table: Top 12 banks financing fossil fuels globally, 2016 - 2020
Resource:
https://www.bankingonclimatechaos.org/bankingonclimatechaos2021/
