In a statement on Tuesday, Canada's largest commercial bank was cited with Wall Street peers Bank of America (BAC), Goldman Sachs Group (GS), and JPMorgan Chase (JPM) for "not taking a basic step of setting interim reduction targets that account for total portfolio emissions."
New York City Comptroller Brad Lander, the New York City Employees' Retirement System, Teachers' Retirement System, and Board of Education Retirement System say they have filed shareholder proposals recommending "an absolute reduction target aligned with a science-based net zero emissions pathway" for each lender.
"Shareholders applauded these banks when they set net-zero goals – but it can't be all talk. We expect them to take the steps needed now to reduce emissions on the timeline to which they have committed," Lander stated on Tuesday. "Absent a concrete plan to reduce absolute emissions in the real world in the near term, any net-zero plan rings hollow."
According to Tuesday's release, as of November 2022, the three New York City Retirement systems combined had a total holding of:
7.74 million shares of Bank of America stock valued at US$239.04 million
437 thousand shares of Goldman Sachs stock valued at US$168.82 million
2.99 million shares of JPMorgan Chase stock valued at US$412.91 million, and
293 thousand shares of Royal Bank of Canada stock valued at US$28.92 million
All of the named institutions are members of the UN's Net-Zero Banking Alliance, which includes a commitment to "annually publish absolute emissions and emissions intensity in line with best practice and within a year of setting targets."
Among the big Canadian banks, RBC has faced the most criticism for its ties to the fossil fuel sector.
Last month, when HSBC Holdings announced plans to halt new lending or capital markets financing for new oil and gas fields, the Canadian unit of the bank set to be sold to RBC was exempted. In October, the Competition Bureau of Canada launched an investigation into "false or misleading environmental representations" by the bank.
"We are committed to achieving net-zero in our lending by 2050, and have established interim emissions reduction targets that will help us drive action and measure progress," Andrew Block, RBC's senior director for climate communication, wrote in an email to Yahoo Finance Canada on Tuesday.
"These targets are informed by science and reflect a measured and deliberate approach to climate action. We expect that they will evolve over time as methodologies, data and decarbonization pathways advance."
"This is big deal, big money coming to the table to challenge RBC and other major banks on their emissions and ultimately their fossil fuel company financing," Richard Brooks, climate finance director at North American environmental organization Stand.earth, said on Tuesday.
"New York City recognizes that climate change doesn't respect borders, and Canada's largest bank needs to get on side with the science if we have a hope of reducing emissions globally."
Jeff Lagerquist is a senior reporter at Yahoo Finance Canada. Follow him on Twitter @jefflagerquist.