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200 and counting – Global financial institutions committed to coal divestment has doubled in three years

May 04, 2023

Not only is the number of financial institutions in the list growing but so is their commitment.

4 May 2023 (IEEFA Global): In its latest report, IEEFA has found that globally significant financial institutions (FIs) are committing to divesting away from coal at a quicker rate as climate change becomes a priority globally. It took almost six years for the first 100 institutions to adopt coal exclusion policies, but since then the number has doubled in just over three years.

IEEFA’s debt markets leader for Asia Pacific Christina Ng said, “We see two prominent trends which are redefining capital markets. First, we see more financial institutions committing to investment policies that are moving away from fossil fuel projects. And second, we are seeing many of these institutions revising their policies and strengthening them as the market increases its knowledge of climate risk as a source of systemic risk to the global financial system. Institutions are getting tougher on what they will finance, and they have identified coal as a risky investment. They see climate risk as a financial risk.

“Interestingly, it’s not the largest asset managers who are leading the way. It’s more the medium- sized ones who recognise their duty to clients. This is a reflection that the market is learning and learning fast amid regulators getting tough on greenwashing. Collectively, the whole finance ecosystem is working together to find where the issues are,” she said.

European financial institutions are leading the way in coal divestment with stricter policies than those in other regions. Though FIs from Asia are also increasing rapidly, with 41 now having formal exit policies compared to only 10 between 2013 and April 2019. A total of 22 FIs in the emerging economies have also established coal divestment policies, including South Africa, Malaysia, China, Turkey, India, and the Philippines. Interestingly these countries are largely reliant on coal for electricity. The U.S., France, the UK, Japan, South Korea, Germany, Australia and the Netherlands have the highest number of FIs with formal coal exit policies. Overall, there are 114 FIs in Europe, 53 in Asia-Pacific, 27 in North America, 6 in Africa, and 2 in South America.

More than half of the 87 banks on our list are United Nations Net Zero Banking Alliance (NZBA) members. Many of them upgraded their policies in 2022 after joining NZBA. Over the past two years, 47 banks have strengthened their coal exit policies, while 16 banks have announced their own coal exit plans for the first time. Notably, half of these new entrants are from Asia, indicating divestment momentum is catching up fast among Asian banks.

Insurance companies, who act as risk managers and underwriters for coal projects and are significant institutional investors themselves, are also fast shunning coal. A total of 51 globally significant insurance and reinsurance companies have established a formal coal exit policy, and the number has more than doubled since IEEFA started reviewing global coal exclusion policies in 2019. One of the notable insurers, which announced its inaugural coal exit policy in 2022, is AIG.

Of the 36 asset managers and owners with formal coal divestment policies, managing assets worth over US$50 billion, half have implemented or improved their policies in the last two years. While several large global asset managers such as France’s Caisse des Dépôts et Consignations, , the UK’s Fidelity International, and Storebrand and Government Pension Fund Global in Norway have established formal coal exit policies, the three largest asset managers, Blackrock, State Street Global Advisors and Vanguard, managing assets worth US$20 trillion, have either formulated weak coal exit policies or have no policy at all. 

The most comprehensive coal exit policies include restrictions across all financial services and products offered by the banks, ceasing all types of business relationships with coal companies, moving beyond just restrictions on individual projects to restrictions on any financial services for companies that have some exposure to coal. These restrictions relate to corporate finance, underwriting and investment as well as restrictions on wider coal activities such as coal gasification, super-critical coal power plants, and coal for rail and port infrastructure.

Ms Ng says the number of institutions making this commitment is likely to continue to grow and more will strengthen existing policies. In particular, FIs in emerging markets are introducing their own coal exit policies influenced by the strong momentum of coal divestments by globally significant FIs, and the rising risk of stranded fossil fuels assets accentuated by the consistent declining cost of clean energy generation.


Read the report: 200 and Counting: Global Financial Institutions Are Exiting Coal – Momentum of coal divestment policies is accelerating

Visit the Coal Divestment website for the full list of financial institutions with a coal exit policy.

Media contact: Amy Lieper a[email protected]  +61 (0) 414 643 446

Author contacts: Christina Ng [email protected]; Saurabh Trivedi [email protected] Shantanu Srivastava [email protected] 

About IEEFA: The Institute for Energy Economics and Financial Analysis (IEEFA) examines issues related to energy markets, trends, and policies. The Institute’s mission is to accelerate the transition to a diverse, sustainable and profitable energy economy. (

Saurabh Trivedi

Saurabh Trivedi is a Sustainable Finance Specialist at IEEFA. His focus is on analysing global investment flows into clean energy and fossil fuel sectors with a specific attention to debt investment.

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Shantanu Srivastava

Shantanu Srivastava is responsible for leading the sustainable finance and climate risk initiatives at IEEFA South Asia. He specializes in the financing, policy, and technology aspects of the Indian electricity market.

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Christina Ng

Christina Ng previously oversaw a team of financial analysts that provide debt market analysis covering Asia Pacific.

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