Following a wave of defections from major banks, the Net Zero Banking Alliance is to pivot from a membership-based organisation to a 'framework initiative'.
The transition follows a stunning loss of confidence in the initiative as major banks from across the US and Europe stepped down in the light of new political positioning on climate change, led by US president Donald Trump.
The alliance, established in 2021 ahead of climate talks in Glasgow, originally required members to commit to reaching net-zero emissions by 2050, set interim emission-reduction targets for carbon-intensive sectors by 2030, and submit annual progress reports.
At its peak it had around 150 members, including most of the world's largest banks. However, that number has dwindled in the last few months, beginning with a mass exodus by US banks and a steady trickle of European institutions.
With major banks backing away from the commitment, the NZBA has paused activities while it awaits a vote on its proposed change of role.
The Alliance's steering group bills the proposed framework model as "the most appropriate model to continue supporting banks across the globe to remain resilience and accelerate the real economic transition in line with the Paris Agreement".