The Commonwealth Bank of Australia (ASX: CBA) share price is in the red as climate activist group, Market Forces, pushes the bank on its commitments to preventing climate change.
At the time of writing, shares in Australia's largest bank are trading for $103.70 – down 2.06%. The S&P/ASX 200 Index (ASX: XJO), meanwhile, is 0.47% higher.
Let's take a closer look.
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CBA share price down amid climate push
In the wake of the devasting climate report by the Intergovernmental Panel on Climate Change (IPCC), which outlined the dire situation humanity is facing in the next 10 years, activists have stepped up the pressure on governments and corporations to do more to mitigate man-made climate change.
Motley Fool Australia has previously reported on how Market Forces is pushing BHP Group Ltd (ASX: BHP) to keep and wind down its high-emitting assets, rather than sell them.
Regarding CommBank, Market Forces and a group of the bank's shareholders are placing a resolution on the agenda of its AGM. The group is asking CBA "to no longer fund expansion of the fossil fuel industry, and to set targets to reduce fossil fuel exposure consistent with net zero by 2050".
It is not clear what impact this could have on the CBA share price going forward.
'CommBank's new climate policy a kick in the guts'
Market Forces claims Commonwealth Bank's current plan aligns closer to net zero by 2070 rather than 2050. This claim was made soon after the release of the bank's full-year results for FY21, which sent the CBA share price to a new record high.
"If the IPCC's report was a kick in the teeth to all those who desperately want a safe climate future, CommBank's new climate policy is a kick in the guts to follow it up", said Jack Bertolus, Australian campaigns coordinator for Market Forces.
"What CBA has delivered today is a retreat from its existing policy, and makes a mockery of its own claim to be supportive of net-zero by 2050.
"We're living in a moment when we need to pull out all the stops to prevent catastrophic climate change, yet the first thing CBA does is aim for failure."
Finally, Market Forces says Commonwealth Bank has "watered down its commitment" to not funding fossil fuel activities that did not comply with the Paris Agreement. It says the bank is now only committing to not providing project funding.
When the Australian Prudential Regulatory Authority (APRA) released a draft guidance for financial institutions and their obligations around climate change, Motley Fool Australia asked CBA for comment.
At the time, a spokesperson for CommBank said:
We are aware of, and are currently reviewing, APRA's draft guidance on managing the financial risks of climate change that was released last week. We continue to work closely with APRA and the broader industry as we strive to limit climate change in line with the goals of the Paris Agreement and support the global transition to net zero emissions by 2050.
CBA share price snapshot
Over the past 12 months, the CBA share price has increased by about 43%. Year-to-date CommBank shares are about 24% higher. It has outperformed the ASX 200 by 18 percentage points over 52 weeks and 10 percentage points in 2021.
Commonwealth Bank has a market capitalisation of around $188 billion.
