Introduction

As companies increasingly focus on combating climate change, a new report reveals that for many of the world’s largest companies, the carbon footprint generated by their investments and cash held in big banks are a significant source, and sometimes their largest source, of emissions. The report also provides a groundbreaking analysis of the hidden climate impact of corporate finances, making it possible to understand the scale of emissions generated by a company’s cash, investments, and financial practices.

Using publicly available data of 10 major corporations, the report illuminates how the financial system–particularly the banking sector undermines the sustainability efforts of climate-conscious companies. Corporate cash and investments do not just sit passively in bank accounts accruing interest. Rather, this money is used to finance everything from energy development to construction projects to small business loans, all of which generate emissions that banks and companies contribute toward.

Overview of Findings

The recent growth of environmentally and socially responsible investments reflects an increasing recognition by companies that how they bank and invest their money has an impact on people and the planet. The report’s research and replicable methodology, which was produced in partnership with finance data experts at leading climate solutions provider South Pole, fills critical data gaps that underscore the magnitude of the emissions generated by corporate cash and investments.

Key findings include:

• For some of the world’s largest companies, including Google, Meta, Microsoft, and Salesforce, their cash holdings are their largest source of emissions; increasing total emissions by 91% - 112%, when compared to most recently reported emissions.

• For companies with more carbon-intensive operations such as Amazon and Johnson & Johnson, their cash holdings still constitute one of their largest emissions sources, increasing total emissions by 11% - 15%, compared to most recently reported emissions.

You can learn more about the methodology used to develop these findings here.