Save for later Print Download Share LinkedIn Twitter Large US banks including Bank of America, JPMorgan and Morgan Stanley are reportedly feeling increasingly uncomfortable about their membership in the UN-convened Net-Zero Banking Alliance (NZBA), a component of the Glasgow Financial Alliance for Net Zero (Gfanz). Amid political pressure over the legitimacy of environmental, social and governance (ESG) considerations, they fear being sued over explicit commitments to phase out fossil fuels. However, beyond local issues in the US, evidence shows that pledges under NZBA are progressing steadily, even if this is slower and less ambitious than climate activists would expect. The issue relates to updated guidelines released in June by the UN Race to Zero campaign, Gfanz's key conceptual source. The new guidelines make explicit the obligation for signatories to restrict fossil fuel financing. "The exact pathways and timelines naturally differ across regions and sectors," Race to Zero insists. But even with this provision, "the explicit phase down and out of all unabated fossil fuels is a bridge too far for many US banks," nonprofit BankTrack's Johan Frijns tells Energy Intelligence. Over the past year, there has been backlash toward ESG investing in some Republican-leaning, fossil-fuel producing US states like Texas, Oklahoma and West Virginia. These states have threatened to cut ties with certain ESG-focused financiers, prompting some firms to promote their commitments to fossil fuel investments.