Bank of America goes back on promise, fuels new coal projects.

TLDR: Bank of America appears to be reversing its pledge to not finance new coal projects, as stated in its “Environmental and Social Risk Policy Framework” from December 2023. The company will now subject such projects to “enhanced due diligence.” This change comes amid conservative backlash against environmental policies, with some states passing laws to prevent banks from refusing to finance coal projects. A coalition of 12 Republican state agriculture commissioners has also raised concerns about banks’ involvement in the Net-Zero Banking Alliance, arguing that it may negatively impact food availability and have broad economic consequences.

Bank of America pledged in 2021 to no longer finance new coal mines, plants, or Arctic oil drilling. However, the 2023 version of the company’s “Environmental and Social Risk Policy Framework” removed these statements. Bank of America now states that certain transactions with heightened risks will undergo an enhanced due diligence process.

Conservative backlash against environmental considerations in business has led other companies to scale back on eco-friendly initiatives. A coalition of 12 Republican state agriculture commissioners has written a letter to six large U.S. banks, including Bank of America, expressing concerns about their net-zero ambitions. These state officials argue that banks’ involvement in the Net-Zero Banking Alliance could harm food availability, lead to price increases, restrict credit access for farmers, and have negative economic consequences.

In response to the backlash, Bank of America said it has a risk-based process for client transactions and that relationships or transactions with heightened risks will go through an enhanced due diligence process involving senior level risk review.

The article concludes by noting that some states, including New Hampshire, Texas, and West Virginia, have passed laws to prevent banks from refusing to finance coal projects and have sought to criminalize environmental, social, and governance (ESG) principles within companies.