World's Largest Bank Joins Sustainability Network
BOSTON, Massachusetts, April 7, 2008 (ENS) – The world’s largest financial services company, Citi Inc., has joined a network of investors, environmental groups and other public interest organizations working with companies to address sustainability challenges.
Citi was approved March 27 as a Ceres network company by the Ceres board of directors, who cited the company’s leadership on climate change as a determining factor. Companies that join the Ceres company network commit to making continuous strides in improving their sustainability performance and reporting practices.
Citibank ATM machines at a New York
City branch. (Photo by Richard
Citi is among more than 70 companies in the Ceres network, including more than 20 Fortune 500 companies. Ceres also directs the Investor Network on Climate Risk, comprised of more than 60 institutional investors who collectively manage over $5 trillion in assets.
“We are pleased and excited to join the Ceres network. Ceres is a well-respected NGO known for its expertise on climate change and stakeholder engagement,” said Pamela Flaherty, president and chief executive of the Citi Foundation and director for citizenship at Citi, “We look forward to partnering with them to further develop our initiatives in this space.”
Citi provides consumer banking and credit, corporate and investment banking, securities brokerage, and wealth management. Citi’s brand names include Citibank, CitiFinancial, Primerica, and Smith Barney.
Until 2004, Citi was one of the world’s top funders of the fossil fuel and logging industries, which made the corporation a major target of the Rainforest Action Network, RAN, and other environmental groups. Embarrassed by demonstrations such as a 35-foot-tall Earth-shaped balloon carrying the message “Citi Lives Richly and the Earth Pays!” at Cornell University and similar critical banners in front of its New York headquarters, in 2004, RAN and Citigroup agreed that the corporation would adopt an environmental policy to guide its lending practices, a step other banks have since taken.
In May 2007, Citi announced its latest expansion of the company’s sustainability program with a $50 billion commitment over the next 10 years to address global climate change.
The company says it intends to act through investments, financings and related activities to support the commercialization and growth of alternative energy and clean technology among the clients and markets it serves, as well as within its own businesses and operations.
“Citi’s commitment to tackle the challenges posed by climate change is exciting,” said Mindy Lubber, president of Ceres. “Citi is well positioned to reduce both its own operational greenhouse gas footprint and those of its clients. Ceres looks forward to working with Citi to develop solutions to the climate threat and further integrate sustainability into the company’s business strategies, products and services.”
Citi joins financial service companies Bank of America, State Street, and Wachovia, which are already members of the Ceres network.
In January, Ceres released a report, “Corporate Governance and Climate Change: the Banking Sector,” which analyzes climate change governance practices of the world’s largest banks. Of the 40 banks scored in the report, Citi was ranked highest among U.S. banks.
The report found that a growing number of banks are beginning to factor the risks of climate change into their businesses, but that more aggressive actions are needed from banks, such as explicitly incorporating carbon costs and climate risk into their lending and investment decision-making.
In response to this growing concern around the carbon impact of investments, Citi joined JP Morgan and Morgan Stanley last month in releasing the Carbon Principles, a new set of guidelines for advisors and lenders to U.S. power companies.
The principles were in response to the financial risks power companies face from emerging carbon-reducing regulations.
“The Carbon Principles are a great start and are heading in the right direction by putting carbon intensive industries on notice that they need to factor carbon costs and climate risks into their business development plans,” Lubber said.
The protests continue. This one took
place on November 16, 2007 at a
Citibank in San Francisco. (Photo
courtesy Rainforest Action Network)
“We are looking forward to seeing Citi and the other bank signatories take these principles a step further by disclosing specifics on actual implementation,” said Lubber, “including carbon pricing.”
Environmentalists are by no means satisfied with Citi’s position. The Rainforest Action Network says the Carbon Principles are “an important step toward recognizing the climate risks associated with financing coal plants” but the group says they are “limited by their lack of any binding commitments and their failure to address the impact of destructive coal extraction methods such as mountaintop removal mining.”
In December, Rebecca Tarbotton, director of Rainforest Action Network’s Global Finance Campaign, pointed out, “Citi is the largest financier of the coal industry, which is by far the leading cause of climate change.”
The environmental group is urging Citi’s new chief executive Vikram Pandit to “set new standards for the banking industry by refusing to invest in outmoded and dangerous industries like coal.”