Consider this example of greenwashing from the Royal Bank of Canada (RBC)’s 2022 Net-Zero Report concerning their 2050 targets. While acknowledging that: “There are significant gaps between our 2019 baseline [emissions] and our targets”, they fudge it by saying: “The achievement of these targets will depend on the collective efforts and actions across a wide range of stakeholders, which are outside of our control.”
These “gaps” cannot be closed without radical reduction in funding of the oil, gas, and mining sectors, according to the UN Secretary General, the UN International Panel (of scientists) on Climate Change (IPCC) and many others, including the International Money Fund (IMF) and International Energy Agency (IEA), both of which have historically been fossil fuel cheerleaders.
While divesting from their fossil fuel clients is entirely within banks’ control, very few of them are moving fast enough, if at all. This is especially true of Canadian banks, of which RBC is the leader that the rest tend to follow. RBC claims that the numbers on which to base the content of their interim targets are not available. From the report:
“…we have not independently verified or assessed the assumptions underlying the data we have obtained from our clients, other third parties and publicly available disclosures and reports, and we are unable to control the availability, quality or reliability of those data.”
“In common with our peers, we face significant challenges in sourcing reliable data for setting interim targets. Inaccuracies in the data underpinning our targets could have a significant impact on our ability to meet them.”
This is classic greenwashing. The Conversation, for example, cites multiple sources for the data in its story Why corporate climate pledges of ‘net-zero’ emissions should trigger a healthy dose of skepticism. It’s a treasure trove of charts and analysis, much easier to read than RBC’s reports which come across as deliberate “blah blah blah”, to quote Greta Thunberg.
In more greenwashing efforts, the report discusses how RBC will measure its “progress”.
“While our ultimate goal of net-zero emissions in our lending activities by 2050 will require reductions in absolute emissions, we chose to set our interim targets using a physical emissions intensity metric…. At a portfolio level, physical emissions intensity measures the exposure-weighted average of the physical emissions intensities of the borrowers in the portfolio.”
This is deliberate obfuscation. According to the Columbia Center on Sustainable Investment:
“Intensity-based decarbonization goals are controversial, as they do not guarantee absolute emissions reductions. If a company’s emissions intensity decreases, but its production volume increases at a greater rate, its annual GHG emissions may still increase. Accordingly, absolute targets are preferable: a company that sets and achieves an absolute emissions target will shrink its carbon footprint, even if its production increases.”
Even the Financial Post calls RBC out on the use of this metric: RBC targets emissions intensity cuts, balks at stronger goals promised by other banks, suggesting that it allows RBC to increase lending to high-emitting sectors.
CarbonBetter, a group that works with corporations to decarbonize, says:
“We’re realists. We know companies can’t just decarbonize overnight. But we can all take steps to do better—and make a collective difference.”
We’re happy to acknowledge that RBC isn’t doing too badly when it comes to reducing its own carbon footprint, using renewables in its own offices and franchises. But when it brags that it’s going to provide $5 billion in sustainable finance by 2025, guess what? One of its beneficiaries is Enbridge Inc., which got a billion Canadian dollars last year to spend on “sustainability”. (See the Fossil Fuel Resistance page on our website for a possible use Enbridge might have for that generous “sustainable financing”.)
Even if RBC’s sustainable funding was plausible and benign, it’s dwarfed by its continued funding of new oil, gas, and mining infrastructure. As the Executive Director of the typically conservative IEA said recently, “There is just no excuse” for continuing to fund fossil fuels.
RBC could warn TC Energy that it will no longer fund any new infrastructure completion or maintenance. Instead, it’s chosen a metric that can allow it to underwrite this and other destructive, racist projects even more. If TC Energy really wanted to decarbonize, it would pull out of fossil fuel extraction and get into the renewable field. And RBC could help make that happen by using stronger words than “encourage our clients to decarbonize” while it continues to fund new pipelines.
In their report, Banking on Climate Chaos, RAN declares that RBC:
“…showered fossil fuel projects with $41 billion dollars in 2022, including $4.8 billion for tar sands and $7.4 billion into fracking. Canadian banks are becoming the banks of last resort for fossil fuels, providing $862 billion to fossil fuel companies since the Paris Agreement.”
And no, it’s not only RBC. TD and BMO are in the tar sands up to their necks and Scotiabank is still funding coal.
If greenwashing is hypocrisy about the environment, there’s plenty more when it comes to Indigenous communities. On its webpage Indigenous Peoples and RBC, RBC claims that:
“Indigenous communities have a long history of partnering with RBC. By building relationships based on mutual respect, shared values, and a common understanding, together we can create a strong, sustainable future for communities from coast to coast to coast.”
This statement of partnership with Indigenous communities sounds on the surface sincere and full of hope. But RBC and its corporate clients have always held a position of power in relationship to Indigenous communities and have consistently used it against them.
They’ve promised jobs for First Nations people starved of work by colonial governments and then set up “man camps” for non-locals that endanger Indigenous women. Corporations like TC Energy and RBC have taken their cue from governments and deliberately divided communities with their “benefit sharing” agreements that come with a muzzle clause forbidding anyone who signs it from criticizing the pipeline, regardless of the harm it inflicts.
The Wet’suwet’en risk no longer being able to depend on wild game, salmon, medicinal plants, and fresh water as they have been able to for generations. When the Wet’suwet’en hereditary chiefs, their clan matriarchs, and their youth have stood up and protested against TC Energy and RBC, the consequences have been severe. (See our webpage The Wet’suwet’en Land Defenders).
Despite their “Ongoing Promise of Positive Action”, for the past two years, RBC’s CEO and Board have behaved shamefully towards the hereditary chiefs and other members of the Wet’suwet’en clans during the bank’s annual general meetings (AGMs):
RBC says they’ll magically achieve their net-zero lending by 2050 “while balancing the needs of people and the planet”. For “people”, read “shareholders”. RBC doesn’t seem to get that at this point in the climate crisis, we can’t differentiate “people” from the planet. (Unless they’re referring to the super-rich who believe they’ll be able to buy safety from climate collapse.) RBC supports the destructive worldview that equates wants and needs and that grants corporations personhood.
RBC says that “As an organization, we recognize the importance of physical and mental health, supporting a broad range of community initiatives through charitable donations, community investments and employee volunteer activities.”
But rather than sponsoring events that could help heal the planet, what does RBC do? Underwrite one of the most environmentally unfriendly sports there is: golf. In its words: “As title sponsor of both the RBC Heritage and the RBC Canadian Open, RBC supports the game both in the US and Canada to create memorable experiences for our clients”. It also boasts about being the official banker of the world’s most highly paid golf pros, many of whom have connections to Saudi Arabia.
Many of RBC’s charitable donations concern youth mental health. This is particularly ironic considering that so many youth worldwide are expressing fears for their future and that confronting the climate crisis that RBC is contributing to has worsened their mental health. In the words of Reed Shapiro, a 23-year-old from New York City:
“So people hear ‘the science behind climate change’ and they think, ‘Yawn’. Those who do look beyond that will immediately feel fear. The science/truth of it all is truly terrifying as it is such an all-encompassing problem that one person couldn’t possibly have any effect on by themselves. I felt a sense of isolation at first, still do, but I’m more driven than I am afraid at this point.”
RBC boasts of its contributions to children’s hospitals—shortchanged by a lack of adequate government funding—while threatening the lives of children everywhere by its continued funding of fossil fuel exploration and development, and causing many young adults to decide it’s too risky to bring children into a potentially dystopian world.
The latest Rainforest Action Network (RAN) report, Banking on Climate Chaos reveals that fossil fuel companies made $4-trillion in profits in 2022, partly through the obscene corporate profits from the Ukraine war. RBC financed an incredible $40.6-billion for fossil fuel companies in 2022, with oil and gas company Enbridge as one of its top two clients.
Dave McKay, CEO | Royal Bank of Canada, 200 Bay St. Toronto, ON M5J 2W7 | 416.974.4475