As more Canadian banks backtrack on formal decarbonization efforts, RBC says it is abandoning its sustainable finance commitment and climate disclosures partly due to regulatory changes.
“We have reviewed our methodology and have concluded that it may not have appropriately measured certain of our sustainable finance activities as presented on a cumulative basis,” the bank said in the report.
RBC said it would not use the methodology going forward, and was “retiring our sustainable finance commitment.”
“We are considering potential changes to our overall approach to sustainable finance, including our Sustainable Finance Framework,” the report authors wrote.
RBC said it would disclose material changes in a future sustainability report, but that it remains “committed to sustainable finance activities.”
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The bank said in its decision that changes in Canada’s Competition Act about measuring environment benefits of businesses led it to reconsider its methodology.
“Given the nascent nature of climate-related metrics, there are limited and evolving recognized methodologies for claims in these areas,” the report authors said. “As a result, this limits the information we can share on certain sustainability disclosures and the progress we are making.”
The decision involves ceasing RBC’s commitment to facilitate $500 billion of sustainable finance this year.
In a similar move, RBC announced on Jan. 31 that it was leaving the United Nations-backed Net-Zero Banking Alliance. The alliance was an initiative led by Mark Carney in 2021, when he was UN Special Envoy on Climate Action and Finance.
The bank followed in the footsteps of five other major Canadians banks, who said they were also leaving the alliance earlier in 2025.
Toronto-Dominion Bank (TD), Bank of Montreal (BMO), Canadian Imperial Bank of Commerce (CIBC), and National Bank of Canada said they were leaving the alliance on Jan. 17. Scotiabank said it was following suit on Jan. 22.
In a Jan. 17 statement, BMO said it remained “fully committed to a climate strategy.” It also said it would continue to support clients looking to transition to net-zero.
The alliance was developed when the global sector was focusing on climate initiatives, CIBC said. It added that the landscape has changed.
TD Bank said it would rely on its own resources for its environmental strategy and to support its clients while the National Bank said it would adopt a pragmatic approach and work with businesses across sections to promote decarbonization.
The Canadian Securities Administrators said in April it had paused work on new mandatory climate disclosures indefinitely. The decision was made in response to developments in the United States, according to chair, Stan Magidson.
Matthew Horwood, Jennifer Cowan, The Canadian Press contributed to this report.
