Banking Executive Compensation should measure Performance in GHG reduction

 A new report from Vancouver-based SHARE (Shareholder Association for Research and Education) examines the impacts that climate change-related risks could have for the banking sector, including their exposure to carbon-intensive assets, but also considering their own administration and operation as corporations. Banking on 2°: The Hidden Risks of Climate Change for Canadian Banks focused on Canada’s five largest banks: Bank of Montreal, Canadian Imperial Bank of Commerce, Royal Bank, Scotiabank and Toronto-Dominion Bank. Amongst the recommendations: banks should have a climate change statement which delineates the steps being taken to reduce the climate impacts of its operations and its financing activities; performance targets to reduce operational and financed GHG emissions should be established and aligned with IPCC models to limit warming to 2°Celsius; and executive compensation and incentive packages should include performance in reducing GHG emissions from operational and financed sources.

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