Even tech companies that have promised to cut their greenhouse gas emissions have a huge climate-related blind spot, according to a new report released by three environmental groups. With their cash and investments, Google, Apple, Meta and other tech giants are indirectly financing fossil fuel companies.
While these companies could have taken steps to reduce pollution within their own operations and supply chains, the financial institutions they bank with still funnel Big Tech profits in highly polluting industries. The emissions associated with that financial activity are so significant that they actually far exceed the emissions from each company’s operations, according to the report.
That pollution has gone unnoticed because it is not normally included in companies’ assessments of their emissions. But if the emissions associated with the cash holdings of Google, Meta, Microsoft and Salesforce were taken into account, it would increase their carbon footprints by between 91 and 112 percent, the report says.
The problem arises from how the banks decide to use their clients’ funds. When businesses trust banks with their cash, the banks put that money to work. The money could be used to finance energy projects or provide loans to other businesses. The world’s 60 largest commercial and investment banks have collectively invested $4.6 trillion in the fossil fuel industry since 2015, according to the report.
Those kinds of investments result in more pollution that is warming the planet. Every billion dollars of cash that a bank puts to work is responsible for pollution comparable to the annual emissions of 27,398 vehicles, the report says. That figure is based on a 2021 report that estimates the carbon intensity of the US financial sector to be roughly equivalent to 126,000 metric tons of carbon dioxide per billion dollars. Those emissions can come from projects and companies funded by the financial sector, which can include things like utilities, mineral exploration, or even real estate and IT projects.
The report, for the first time, estimates the financial carbon footprints of nine different technology and media companies: Google, Meta, Amazon, Apple, Microsoft, Salesforce, PayPal, Disney and Netflix. The researchers obtained information about each company’s cash and investments from SEC filings. The report’s authors then compared that to established measures of carbon intensity for different types of investments to estimate each company’s financial footprint.
Apple reported $191 billion in cash and investments to the SEC in 2021. The report estimates that those billions of dollars generated nearly 15 million metric tons of planet-warming emissions. That figure is three times more climate pollution than the emissions generated by the use of all Apple products in the world that year, the report says.
By 2030, Apple plans to reduce its own carbon dioxide emissions by 75 percent. On its way to that goal, the company has pressured hundreds of its suppliers to reduce their own pollution. Companies like Apple that want to make a positive impact on climate change should consider applying the same pressure to banks, the report’s authors argue.
The report was produced by the International Climate-Safe Lending Network, The Outdoor Policy Outfit think tank, and BankFWD, founded by the Rockefeller family. The groups enlisted the help of financial data experts from the social enterprise South Pole, which advises companies on their sustainability goals.
“The power of this report is that its data tells us that the lever we use the least turns out to be the most powerful tool we have: where and how we choose to bank,” said Valerie Rockefeller, co-president of BankFWD, in a press release. “The choice of banks is a largely untapped frontier for climate leadership with enormous potential for impact.”
Google, Netflix and Microsoft declined to provide comment to the edge on record. The other companies did not provide a response at the time of publication.
To see how each company’s financial carbon footprint stacks up, check out the full report.