Global Trade Review Editorial: Encouraging yet disheartening
(Global Trade Review, London, 11 April 2022) Momentum continues to build around environmental, social and governance efforts in trade and trade finance. Every week, we report on encouraging new developments, including a recent decision by the European Council that gives export credit agencies (ECAs) in the EU until the end of 2023 to set deadlines for ending support for fossil fuels; the formation of the Climate Working Group, a new initiative convened by the Berne Union bringing together ECAs and other insurers and financiers to accelerate climate action; as well as the much-anticipated launch of a pilot of a new ESG scoring tool for measuring country, supply chain and company activity against EU and UN sustainability goals. Other developments have been less heartening. The annual Banking on Climate Chaos report, a comprehensive global analysis on fossil fuel financing released as this publication goes to press, documents that in the six years since the adoption of the Paris Agreement, the world’s 60 largest private banks poured US$4.6 trillion [yes trillion] into fossil fuels. As much as US$742bn of support was provided in 2021 alone. The report, co-authored by NGOs including BankTrack, Sierra Club and Oil Change International, includes a timeline that lays out how banks that joined the Net-Zero Banking Alliance last year simultaneously financed “some of the most egregious oil and gas expansion companies”. In this publication, we take a closer look at these and other issues impacting on ESG and trade.