Glasgow Financial Alliance for Net Zero announces restructure and shift of focus to addressing barriers to mobilising capital following departure of multiple banks from its Net Zero Banking Alliance
The Glasgow Financial Alliance for Net Zero (GFANZ) was launched in April 2021 by the UN Special Envoy on Climate Action and Finance, Mark Carney, and the COP26 presidency. It set out to develop the building blocks for a financial system capable of financing the transition to net zero, encompassing sub-alliances including the Net Zero Banking Alliance (NZBA).
At the end of 2024, Michael R. Bloomberg, Mark Carney, and Mary Schapiro – leaders of GFANZ – announced that moving forward into the new year GFANZ will allow any financial institution working to mobilise capital and lower the barriers to financing energy transition to participate. Previously, participation was contingent on alignment with the Paris Agreement.
Two days later, GFANZ Secretariat shared a new year update, outlining its plan to restructure and shift its focus to addressing barriers to mobilising capital. It stated:
“Since its launch at COP26, GFANZ has achieved its initial goal of developing the building blocks of a financial system capable of financing the transition to net zero. To successfully transition the economy, we must accelerate progress in public policy and technology developments, and close three critical gaps: data, action, and investment.”
More than 500 major financial institutions representing over $100 trillion in balance sheets have voluntarily developed independent transition plans using the GFANZ Framework. Moving forward, it will focus on closing the investment gap, according to the statement, helping to unlock the annual $5 trillion opportunity created by modern energy systems and the transition to a low-carbon economy.
To work towards this, GFANZ will transition to an independent Principals Group, led by CEOs and leaders of financial institutions acting to address the barriers to mobilising capital globally.
Further, GFANZ also emphasised its focus on public-private partnerships, aiming to scale private finance alongside governments, multilateral development banks (MDBs), and other development partners. It will continue collaborating with MDBs, including the World Bank Private Sector Investment Lab, to develop tools that scale private-sector investment globally.
The update follows the departure of several major banks from the NZBA, including Citigroup, Bank of America, whose CEOs remain as part of the Principals Group.
GFANZ reiterated its commitment to driving forward, “Overcoming barriers to mobilising capital at the scale and speed required to achieve net zero is urgent and achievable. GFANZ is steadfast in its commitment to supporting financial institutions worldwide in addressing these challenges and seizing the opportunities of this pivotal moment.”
