NZBA misses the target on steel: banks must step up decarbonization efforts

The NZBA's steel sector guidance is criticized for failing to mandate strict target methodologies, omitting capital markets activities, and ignoring coal mine methane emissions. The authors argue that banks must adopt policies to end financing for blast furnace expansion and metallurgical coal mining to align with a 1.5°C pathway.

• The NZBA's steel guidance is insufficient because it does not mandate robust target design or comprehensive policies in banks' just transition plans to ensure a fossil-free future.
• The NZBA guidance fails to include coal mining emissions (scope 3 upstream), specifically methane releases, which could increase the steel industry's 20-year climate impact by 27%.
• There is a discrepancy between the NZBA's general climate guidelines, which require targets for 'facilitated emissions' from capital markets activities like underwriting, and the specific steel guidance, which omits this requirement despite capital markets being the primary source of bank financing for steel.
• Analysis of 90 NZBA members shows a lack of ambition and consistency: only 38 have set steel sector targets, and only five include capital markets activities, while only five cover scope 3 emissions (none of which include coal mine methane).
• To align with 1.5°C, banks should adopt policies to refuse support to steel companies that lack transition plans including detailed timetables for phasing out coal assets and commitments not to build, expand, or refurbish blast furnaces.

APA

Martin, L. (2024). NZBA misses the target on steel: banks must step up decarbonization efforts. Reclaim Finance. https://reclaimfinance.org/site/en/2024/07/05/nzba-misses-the-target-on-steel-banks-must-step-up-decarbonization-efforts/

Chicago

Martin, Léo. NZBA misses the target on steel: banks must step up decarbonization efforts. Reclaim Finance, 2024. https://reclaimfinance.org/site/en/2024/07/05/nzba-misses-the-target-on-steel-banks-must-step-up-decarbonization-efforts/.

Wikipedia

{{cite press release |last1=Martin |first1=Léo |title=NZBA misses the target on steel: banks must step up decarbonization efforts |publisher=Reclaim Finance |date=5 July 2024 |url=https://reclaimfinance.org/site/en/2024/07/05/nzba-misses-the-target-on-steel-banks-must-step-up-decarbonization-efforts/ |access-date=23 October 2026 |via=Climate Insights Directory}}

BibTeX

@misc{martin2024nzba, author = {Martin, Léo}, title = {{NZBA misses the target on steel: banks must step up decarbonization efforts}}, publisher = {Reclaim Finance}, year = {2024}, month = jul, url = {https://reclaimfinance.org/site/en/2024/07/05/nzba-misses-the-target-on-steel-banks-must-step-up-decarbonization-efforts/}, urldate = {2026-10-23}, note = {Indexed by Climate Insights Directory} }