French NGOs are suing BNP Paribas bank for failing to meet its commitments to fight the climate emergency and to demand that it stops investing in fossil fuels. It is the first legal action of its kind against a commercial bank.

Les Amis de la Terre, Notre Affaire à Tous and Oxfam France have filed a lawsuit against BNP Paribas in a Paris court to demand that it honours its climate change commitments and stops investing in fossil fuels. It is the first legal action of its kind against a European commercial bank.

The lawsuit is based on 2017 French legislation, which requires large companies based in France, or international corporations with a significant presence in the country, to establish clear measures to prevent human rights violations and environmental damage.

Activists accuse BNP Paribas of financing fossil fuels and supporting companies that aggressively develop new oil and gas fields and infrastructure, while urging the financial institution to adopt an exit plan from its current portfolio based on hydrocarbon loans and investments.

In a statement released in January, the bank insisted on its commitment to economic sustainability and support for the goal of achieving climate neutrality by 2050. It stresses that, to date, more than half of its financing for energy production is oriented towards low-carbon energies.

Spanish banks are not doing their homework

The International Institute for Law and Environment (IIDMA) has repeatedly warned that major Spanish banks are not fulfilling their obligation to report on the environmental impact of their financial activities, as required by the law on the Commercial Code since 2018.

In the latest report published by the Institute in November 2022, it analyses the degree of compliance of Bankinter, Banco Sabadell, Banco Santander and CaixaBank. Although the IIDMA recognises that progress has been made in terms of transparency, it also warns that the main Spanish banks continue to omit relevant information on the environmental impact of their financial operations.

Specifically, it notes that Spanish banks do not disclose data on greenhouse gas emissions attributable to their financial products, as well as their exposure to climate change-related risks. While banks reaffirm their commitment to decarbonising their customer portfolios, the study points to shortcomings in identifying and reducing their exposure to the most carbon-intensive sectors.

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