Guidelines for climate targets setting for banks

The UNEP FI’s Collective Commitment to Climate Action (CCCA) group of 38 signatories has developed these Guidelines for Climate Target Setting, which outline key principles to underpin the setting of credible, robust, impactful and ambitious targets in line with achieving the objectives of the Paris Agreement. The role of the banking industry in tackling this challenge is key. Banks will need to support the transition to a net-zero economy through their lending and financing decisions and through facilitating their clients’ transition.

For signatories to the CCCA, the implementation, monitoring and reporting against these guidelines fit into wider UNEP FI Principles for Responsible Banking governance processes. The Guidelines will be reviewed at least every three years, and sooner when required. The guidelines outline four principles for target-setting:

• Banks shall set and publicly disclose long-term and intermediate targets to support meeting the temperature goals of the Paris Agreement.
• Banks shall establish an emissions baseline and annually measure and report the emissions profile of their lending portfolios and investment activities.
• Banks shall use widely accepted science-based decarbonisation scenarios to set both long-term and intermediate targets that are aligned with the temperature goals of the Paris Agreement.
• Banks shall regularly review targets to ensure consistency with current climate science.