The Competition Bureau is investigating RBC for alleged misleading marketing related to the bank’s action on climate change.
The investigation arose from a complaint filed by six members of the public earlier this year. At issue is RBC’s continued funding of fossil fuels while also supporting global plans to reduce greenhouse-gas emissions to transition to a net-zero economy by 2050.
The complaint was supported by a couple of environmental organizations — Vancouver-based law charity Ecojustice and environmental advocate Stand.earth.
In a letter dated Sept. 29 addressed to Ecojustice lawyers, the Competition Bureau said it launched an inquiry into RBC’s “alleged deceptive marketing practices” to determine the facts related to the allegations.
RBC, together with Canada’s other big banks, is part of the Net-Zero Banking Alliance, the banking component of the Glasgow Financial Alliance for Net Zero, chaired by UN special envoy and former Bank of Canada governor Mark Carney. The alliance commits members to align their lending and investment portfolios with net-zero emissions by 2050, as well as set earlier targets.
Canada’s big banks are also part of the Partnership for Carbon Accounting Financials, which aims to standardize reporting of financed emissions.
In March a report from San Francisco–based environmental organization Rainforest Action Network said Canada’s big five banks all increased their fossil fuel financing from 2020 to 2021.
And in July a report on banks’ climate action by the Transition Pathway Initiative, a global group led by asset owners, highlighted how banks are falling short in the transition to net zero.
Previously, in response to criticism about the bank’s net-zero commitments, RBC CEO Dave McKay called for an “orderly transition” to net zero, saying the bank is working on emissions reduction goals for its oil and gas, utilities, and automotive portfolios.
In a release, Ecojustice lawyer Matt Hulse, one of the lawyers to whom the Competition Bureau’s letter is addressed, criticized RBC for its continued financing of fossil fuels and failure to account for most of the emissions from the fossil fuel companies it finances.
“Without a credible plan, RBC is just making an unverified promise to clients that it will act eventually,” Hulse said in the release.
Greater scrutiny of banks’ and asset managers’ environmental claims have led to recent regulatory action.
Earlier this year the U.S. Securities and Exchange Commission sanctioned a firm for alleged mis-statements about ESG decision-making. And both regulators and law enforcement in Germany are investigating suspected greenwashing at asset manager DWS Group.