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Banks in Türkiye showed little progress in 2024 toward aligning their portfolios with the country’s 2053 net-zero emission target, according to a joint report by the climate organization 350 Türkiye and the Sustainable Economy and Finance Research Association (SEFIA).
The report, titled "The Approach of Banks in Türkiye to Climate Change," reviewed 17 private, public, and investment banks across five key criteria: fossil fuel financing, net-zero targets, carbon footprint, clean energy investments, and Environmental, Social, and Governance (ESG) ratings.
The analysis found no changes in banks’ policies toward coal financing compared with the previous year. Eleven banks continue to pledge not to fund new coal projects, while only six have committed to fully exiting existing coal investments.
QNB Türkiye became the latest to announce a net-zero target, bringing the total number of such banks to 13. However, 11 of the 17 banks have yet to adopt one or more commitments—such as banning coal financing, phasing out existing projects, or declaring a net-zero goal.
The report warned that banks’ limited and inconsistent climate commitments increase "transition risk" — the potential financial losses linked to the global shift toward a low-carbon economy.
Türkiye’s sustainable finance volume exceeded $20 billion by the end of 2024, supported by growth in green bonds and sustainability-linked loans. Yet most initiatives target 2050 or beyond and lack intermediate milestones, delaying systemic transformation in the sector.
The publication of the Türkiye Sustainability Reporting Standards, mandatory for large companies as of 2024, was viewed as a positive development in the report. However, discrepancies in reporting and limited institutionalization of data collection among banks continue to hinder transparency and comparability, the analyst said.
SEFiA Senior Energy Analyst Dr. Evrim Ozyorulmaz Akcura said most banks set long-term net-zero targets—typically by 2050—without concrete short-term action plans. "The lack of five- to ten-year roadmaps shows that banks’ climate strategies are not grounded in robust frameworks," she noted.
Efe Baysal, coordinator at 350 Türkiye, warned that the suspension of the Net-Zero Banking Alliance (NZBA), a key global initiative, highlights weaknesses in collective action. He said the current situation reveals "the fragility of a commitment-based approach to climate finance" as the sector faces potential asset losses and financial instability during the low-carbon transition.
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