Warren calls on regulators to ‘crack down’ on Wall Street’s fossil fuel financing


SFr. Elizabeth Warren calls on US financial regulators to “crack down” on Wall Street, accusing big companies of catalyzing climate change by funding fossil fuel production.

The Massachusetts Democrat cited a recent report by environmental group Sierra Club and think tank Center for American Progress, which calculated that last year major banks and asset managers were responsible for enough gas emissions. greenhouse effect to bring them together with the world’s main emitters. .


“The volume of greenhouse gases emitted by the financial services industry is outrageous. If it were a country, it would be the fifth largest emitter in the world,” Warren said. wrote in a tweet on Monday. “Regulators must crack down on the role of the financial sector in the #ClimateCrisis.”

The study in question found that the 18 largest banks and asset managers in the United States funded the equivalent of 1.968 billion tonnes of carbon dioxide in 2020. If the sector was a country, according to the study , this would make it the world’s fifth-largest emitter behind China, the United States, India and Russia.

Climate hawks look to financial regulation as a way to slow oil, gas and coal production and cut emissions, especially as tighter congressional restrictions on the fossil fuel industry remain pending due to lack of consensus in Congress.

A number of large Wall Street companies have already voluntarily committed to restricting funding for fossil fuels, with coal, the most emitting fuel, being a prime target.

JPMorgan Chase, one of the banks included in the above report calculations, released an environmental and social policy framework in October, according to which the company will not provide financing or advisory services to clients who derive most of their income from coal mining. The policy is also aimed at the end of 2024 to phase out “the remaining credit exposure to these customers”.

But the Sierra Club study maintained the industry “has yet to respond in a way that suggests an understanding of the scale of the crisis or the industry’s role in its cause,” and other critical lawmakers as Democratic Senator Sheldon Whitehouse complained the same with regard to a lack of action.

In the meantime, the Biden administration has taken its own steps towards financial regulations related to climate change. The Financial Stability Supervisory Board, which is chaired by Treasury Secretary Janet Yellen and is made up of senior officials from federal agencies such as the Federal Reserve and the Securities and Exchange Commission, released a report in October for the first both establishing that climate change poses an “emerging and growing” risk problem for financial stability.

The FSOC has recommended an improvement in “climate-related disclosures” to “give investors and market participants the information they need to make informed decisions”.

Republicans have spoken strongly against using financial regulation to fuel the Democrats’ energy and climate agenda.

“The real risk here is political in nature,” said Republican Senator Pat Toomey, a senior member of the Banking Committee, in response to the FSOC report. “This could open the door for unelected and irresponsible financial regulators who abuse their powers to choke capital from energy companies and weaken the economy.”


Oil and gas industry executives have also blamed both the regulatory stance of the Biden administration and the decisions by financial institutions to withhold funding to restrict producers’ access to capital, thereby fueling pressure on companies. energy markets.


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