In recent years, many of the world’s biggest banks have published reports chronicling the vast sums they say they’re channeling into environmental and social activities. Now, senior people inside the industry are raising questions about those statements.
Banks including Morgan Stanley, HSBC, Goldman Sachs and JPMorgan Chase & Co. have announced individual sustainable finance targets for 2030 that range from $750 billion to $2.5 trillion. Yet such statements leave investors with little real insight into the very different ways in which banks are defining what’s sustainable, according to senior bankers familiar with how the figures were compiled but who asked not to be identified discussing private deliberations.
The differences in accounting range from how banks treat mergers and acquisitions and debt underwriting to how they calculate revenue from market making, private equity investing, money-market funds, private banking, mortgages and revolving credit facilities, the people said.