by Nour Bundogji
Citi, the leading global bank, announces a sustainability strategy that should last for over ten years— $100 billion for lending, investing, and facilitating sustainability solutions. This eye-popping financial commitment is part of Citi’s five-year plan that was launched by CEO Michael Corbat in New York last week. “It includes three strategic priorities that align the company’s corporate and sustainability strategies: combating climate change, championing sustainable cities, and promoting social progress, including universal human rights” reports Joel Makower from Greenbiz.com who sat down with Val Smith, Citi’s director of corporate sustainability. Furthermore, Corbrat informed Mary Lubber at Forbes.com that this strategy will include “financing for large renewable-energy projects such as municipal infrastructure to reduce water waste; assistance for clients to address environmental risks; and an 80 percent absolute greenhouse gas reduction target.”
Citi’s commitment to sustainability and clean energy is not new. In 2007, Citi made its first financial commitment of $50 billion for a ten-year pledge to “invest in and finance projects that reduce global carbon emissions” says Makower. However, Citi met its financial goal three years earlier than expected. The new $100 billion goal “builds on the learnings that we accumulated during the first $50 billion. When we knew that we were going to hit the $50 billion goal three years early, we did an assessment across our different businesses. We wanted to expand the scope of the $100 billion goal so that we could capture a lot of other activities that are very important to people, that are very important to cities, that our clients are deeply engaged in,” Smith told Makower.
Nonetheless, Citi was one the first major banks to set reduction goals for energy, waste, and water. For instance, in 2003 it was one of the ten global banks to sign the Equator Principles, which is a risk management framework for financial institutions to help them determine, assess, and manage environmental and social risks.
Bloomberg New Energy Finance recently released the clean energy investment numbers for 2014. Although clean energy investment increased 16% ($310 billion, an all-time high), “it’s just not enough,” says Lubber.
Regardless, “Citi is showing that investing in clean energy is smart business, and that – with a bit of ambition and commitment – it can be done right now. It’s a clear market signal that should resonate with the industry,” claims Lubber. Although Citi has a long road ahead, this $100 billion commitment is a critical step in the right direction showing what corporate leaders are capable of.
Lubber, M. Citi’s $100 Billion Downpayment On Clean Energy Future. Forbes.com. Feb. 20, 2015.
Makower, J. Inside Citi’s plan to deploy $100 billion for cities, renewables, climate. Greenbiz.com. Feb. 18, 2015.