The Guidelines for Climate Target Setting for Banks 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 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.
The guidelines were drafted by the signatories to UNEP FI’s Collective Commitment to Climate Action, a leadership group of banks accelerating the commitment all Principles for Responsible Banking signatories have made to align their portfolio with the goals of the Paris Agreement. These guidelines also underpin the UN-convened Net-Zero Banking Alliance where banks have committed to a timeline of net-zero by 2050. The guidelines will be reviewed at least every three years, and sooner when required.