New Survey from IIF and Deloitte Reveals How Financial Services Firms Are Progressing on Net Zero Goals through Organizational Change
January 17, 2023
Report examines how financial services executives and companies are implementing change to reach net zero deadlines less than a decade away.
A new report released today by the Institute of International Finance (IIF) and Deloitte examines how financial services firms are turning commitments to net zero targets into action, and how their organizations are tackling the ever-shortening timeline. The report surveyed 135 financial services executives in over 40 countries and includes first-hand accounts from sustainability professionals, and acceleration tips for firms who want to learn from others’ experience.
"Achieving net zero requires shifting focus, strategy and execution – but the financial institutions that mature in this process and understand the business imperative are poised to reap the rewards," Tim Adams, President and CEO of IIF, said. "Large scale business transformation with sustainability at the center is clearly the winning strategy that will enable companies to achieve these goals, leading us to a low-carbon future."
According to the survey, financial institutions that make a public net zero commitment show consistently higher levels of preparedness to meet the climate challenge. The effects of commitment range from greater integration of net zero in strategy to better progress on ESG data integration and disclosure. Consistent responses from executives indicate that the commitment to net zero adds invaluable impetus to a firm’s net zero efforts, helping to sustain momentum when the inevitable challenges arise.
“Financial institutions should work to embed sustainability across their own organizations, and in how they do business, as they can play a critical role in supporting their clients’ decarbonization strategies and providing investors transparency,” says Anna Celner, report sponsor and Senior Global Banking Advisor, Deloitte Switzerland. “The industry as a whole has the opportunity and the responsibility to embrace the transition to low carbon, share best practices, and collaborate to help enable the transformation of diverse industries, sectors, and even entire economies.”
Key findings from the report include:
- Risk: Risk departments still have a long way to go in being able to address the full scale and scope of climate risk for clients, as only 3% of firms surveyed stated that they are confident they can assess the climate risks of individual customers.
- Products and Services: Firms are launching new products to accelerate their clients’ transitions. A quarter of firms surveyed have already launched products (or services), particularly for power, oil and gas, real estate, and transport.
- Talent: While respondents flagged that the talent to execute on these commitments is rare, they’re continuing to hire at speed. Over 50% of those surveyed say they have added headcount or created new roles to deliver on their net zero strategy.
- Data: Insights and hard numbers are key to meeting net zero strategies for firms, but it appears to be a universally missing link as no one has data that is fully complete, accurate or sufficiently understood. However, firms are still charting towards directional targets that are proxies for the firm’s ambitions and act as meaningful guides to action.
The full report is available here.
About the Institute of International Finance (IIF)
The Institute of International Finance (IIF) is the global association of the financial industry, with about 400 members from more than 60 countries. The IIF provides its members with innovative research, unparalleled global advocacy, and access to leading industry events that leverage its influential network. Its mission is to support the financial industry in the prudent management of risks; to develop sound industry practices; and to advocate for regulatory, financial and economic policies that are in the broad interests of its members and foster global financial stability and sustainable economic growth. IIF members include commercial and investment banks, asset managers, insurance companies, professional services firms, exchanges, sovereign wealth funds, hedge funds, central banks and development banks. To learn more about IIF, please visit www.iif.com, follow us on Twitter, LinkedIn or YouTube, or check out IIF’s podcasts.
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