State of the Banking Transition 2026

The TPI Centre’s State of the Banking Transition 2026 report reviews the progress of 36 large global banks on the low-carbon transition. The report provides a basis for assessing how banks’ climate commitments and policies are evolving, including where they are being scaled back. The analysis draws on two assessment tools: the Net Zero Banking Assessment Framework (NZBAF), which uses a structured set of 72 sub-indicators to evaluate a bank’s transition plan, and Carbon Performance for Banks, which assesses which sectors and business activities banks set decarbonisation targets for and whether their sectoral decarbonisation pathways align with low-carbon benchmarks.

Key points for decision-makers:

• Over a decade after the Paris Agreement, banks remain at an early stage in enabling the transition to a low-carbon economy. Indeed, there are signs of stalling. In the past three years, assessed banks have reduced their low-carbon ambition overall, with some even cancelling their commitments, targets and policies outright.
• Since peaking in 2022 and 2023, sectoral target-setting by banks has declined sharply. No bank assessed during the past three years has set new short-term (2030) targets in 2026. While most banks have targets for autos, electricity utilities, oil & gas and steel, few cover chemicals, food, diversified mining and metallurgical coal.
• While 30 of the 36 banks assessed classify climate-related risks as a key risk, only seven (all European) disclose the underlying accounting assumptions and judgements used to quantify climate-related risks in their financial statements.