Sovcombank, Russia’s third largest private bank by assets, signed on to a major international platform pushing for carbon neutrality to mitigate climate change.
The bank signed a pledge to join the United Nations’ Climate Neutral Now movement. This measure is aimed at non-financial reporting transparency and support for environmental goals, according to a Sovcombank statement. Specifically, Sovcombank will measure, reduce, and annually report its greenhouse gas emissions as the first Russian signatory bank.
The pledge joins a major pillar of Russian finance with goals held by the international community.
The bank employs 23,000 people in over 1,000 cities and towns across Russia. It serves 12 million clients, which it details as 11 million borrowers and one million depositors. That alone engages a large group of people in moving towards practices that cut carbon emissions.
“We actively contribute to initiatives that support responsible transformation and low-carbon transition aiming to inspire and encourage our clients’ decisive action towards achieving their environmental goals,” said Dmitry Gusev, Chairman of the Management Board of Sovcombank. “We are proud to be the first Russian bank to have signed the global pledge of the Climate Neutral Now challenge and accelerate the pathway towards national and global climate neutrality.”
Sovcombank has been a prominent actor in Russia’s burgeoning green finance movement. Last year the bank signed an agreement with St Petersburg Exchange to jointly form a green and social bonds segment for trade in low-carbon energy certificates, greenhouse gas emission quotas, and emissions-neutral footprint certificates. Earlier, Sovcombank became the first Russian issuer to place social eurobonds, with a placement valued at $300 million.
The United Nations Framework Convention on Climate Change (UNFCCC) launched Climate Neutral Now to increase global action on climate change. It raises awareness, builds capacity, and develops collaborative efforts to measure and reduce carbon footprints. It is a tool to help achieve a climate-neutral (net- zero) world by 2050, as enshrined in the Paris Agreement, according to the bank.
“Climate Neutral Now is an initiative that contributes to putting the world on the path to climate neutrality, as enshrined in the Paris Agreement, by encouraging non-Party stakeholders to take climate action,” Patricia Espinosa, Executive Secretary United Nations Framework Convention on Climate Change, said on the organisation’s website.
Sovcombank set new ESG targets in its 2020 sustainability report, including to reach net-zero greenhouse gas emissions from its own operations by 2030 and from both operational and attributable emissions by 2055. It raised the bar last year with a new aim to hit net-zero emissions associated with operational and financing activities by 2050. That announcement was part of its collaboration with the Net-Zero Banking Alliance (NZBA).
The UN initiative is not a certification scheme for its participants. It is a tool to promote additional voluntary action on climate change and provide recognition for companies that take meaningful steps, according to the UN website.
Sovcombank’s pledge shows the right kind of progress. It has its own ESG programme, including a climate initiative. Yet voluntary action on international platforms like those held by the UN is key for organising a coordinated response to climate change and making these efforts visible to investors and the public.