As millions of us awaited the results of who would be Canada’s next Prime Minister, the country’s largest bank tried to bury a climate bombshell.

As first reported by Reuters, the Royal Bank of Canada (RBC) attempted to use the cover of the federal election to release its Sustainability Report, including an announcement shaking corporate boardrooms, finance conferences, and communities alike: RBC is abandoning its sustainable finance targets and walking back other climate commitments.

RBC is arguably one of Canada’s most influential companies because of its size and importance. It’s also the country’s top financier of coal, oil, and gas, financing $256 billion USD in fossil fuels since 2016, according to the 15th annual Banking on Climate Chaos report.

There have always been issues with RBC’s sustainable finance target, which increased in 2021 to reach $500 billion of financing by the end of 2025. For example, RBC counted some loans to fossil fuel companies towards this target. That’s why a complaint was filed with Canada’s Competition Bureau in 2022.

The Competition Bureau opened an investigation into the bank’s misleading claims that it is a climate leader despite its continued financing of fossil fuel projects.

While some of RBC’s sustainable-labeled activities were already suspect, the existence of a transparent public target was important. Now the bank, by abandoning its commitments and refusing to disclose climate accounting, risks sending a message that it’s acceptable to walk back climate progress. 

This presents a fork in the road to Prime Minister Carney, with his newly launched catchphrase of “Build, Baby, Build.” Trump’s hostile tariffs, while attempting to hold our economy hostage, are also giving companies an excuse for backsliding cloaked in more protectionist, “Elbows Up” propaganda.

Will Canadians accept the dangerous message that RBC is sending, getting swept along the slipstream of deregulation and uneconomical pipelines, while ignoring the fires and floods? 

Or do we truly build Canada into a global – renewable – energy superpower?

Down the path of possibility, there’s an opportunity for Carney, with his global banker rolodex, to get financial institutions (both public pensions and banks) aligned to do good. Furthermore, Carney’s new government must act to regulate and incentivize real climate investments. 

To slow the climate crisis, we can’t let financial institutions drag us backwards and send the wrong message to the rest of corporate Canada. 

While major banks like BMO, National Bank, and others gave the impression that they weren’t immediately following RBC in (publicly) dropping climate finance commitments, there’s no current accountability mechanism to make sure their commitments hold. 

Canada’s big banks have financed over $1.2 trillion into climate-disastrous fossil fuels since the Paris agreement was adopted, and all six big banks have exited the voluntary global banking climate coalition set up by Carney, a betrayal of their 2021 promise to help limit the impacts of the climate crisis. 

Mark Carney has formed global alliances to drive climate action from financial institutions, and served as the United Nations Special Envoy for Climate Action and Finance. As the Governor of the Banks of Canada and England, Carney is well-aware of the power of financial systems, institutions, and how important well-placed investment and money is. 

Carney knows the power of investment, and learned the hard way that voluntary initiatives are insufficient to reorient the financial sector. A federal government whose leader understands climate change must wield the full extent of its powers to regulate decisive and long-term policy by banks, pension funds, and other financial institutions to invest in renewables and phase down fossil fuel financing.

Digging and drilling for more oil and gas and expanding pipelines and liquified “natural” gas (LNG) terminals for export is not a solution. Industry would like us to believe it’s for consumer benefit, yet it’s billionaires, executives, and often foreign shareholders who overwhelmingly profit, while energy bills, gas prices skyrocket and the affordability crisis worsens. 

Hard-earned tax payer dollars should not be spent on more pipelines and gas terminals.

During the election, there was much soundbite competition from the major party leaders to create fantastic energy corridors to speed up development. From a human rights perspective, it is impossible to create a carte blanche, anything-industrial-goes, “corridor” across the traditional territories of hundreds of First Nations and communities across Canada to fast track oil and gas pipelines. These are not empty lands. Not only is it unfeasible and unethical, it’s also not strategic economic policy.

The International Energy Agency (IEA) Net Zero Roadmap underscores that to keep temperatures under 1.5 degrees, no more new fossil fuel infrastructure is needed. Rather, investment in renewables, transit, green homes, efficiency programs, and electrifying transportation and industry is the pathway to address this crisis. These shovel ready projects can net big gains in long-term, green energy jobs, grow the Canadian manufacturing industry, and truly turn Canada into a clean energy superpower. 

Now is the time to be the global economist he is, and help wield the power of our banks and pension funds to do climate good in the world; the person who understands climate change and can see the pathway through a tangled web of investment, public subsidies and funds, private sector institutions, polluter accountability, and ready-to-deploy-today solutions.

Our banks are the biggest funders of dirty energy in the world. Imagine if Carney’s new government helped persuade, incentivize, and regulate those billions in fossil energy funding into clean, reliable, and accessible renewables instead?

In 2019, Carney wrote: “We need collective leadership and action across countries and we need to be ambitious. [C]limate change is a global problem, which requires global solutions, in which the whole financial sector has a crucial role to play.”

It’s time we hold him to it. With public pressure, we can demand Carney walk the talk on his pronouncements over the last decades – in books, essays, as the Governor of the Bank of England, as UN Special Envoy, and likely to his children. This is his moment to choose whose side he’s on: the people or polluters?

Richard Brooks is the Climate Finance Director at Stand.earth, a grassroots environmental organization working to transform policy and laws in the United States and Canada.