A red light on Bay Street in Canada's financial district is shown in Toronto on Wednesday, March 18, 2020. The CEOs of Canada's five biggest banks are set to testify before a parliamentary committee later today about the impacts of the financial sector on climate and the environment. THE CANADIAN PRESS/Nathan Denette

The CEOs of Canada's five biggest banks stuck to the message that they're committed to help in the energy transition as they were questioned by a parliamentary committee Thursday about their impacts on climate change.

The leaders of Royal Bank of Canada, TD Bank Group, BMO Financial Group, Scotiabank and CIBC pushed back against MPs who said they were making the problem worse by funding the oil and gas industry to the tune of more than a hundred billion a year, and challenged them to cut back.

"Just stop is just not an option for us," said RBC chief executive Dave McKay, appearing by video conference along with the other CEOs before the House of Commons standing committee on environment and sustainable development.

"It's important that we do this in an orderly fashion, or we risk the entire journey. We have to protect jobs along the way," he said.

The banks all talked about their commitments to working with clients through the transition, rather than pull back on funding, along with their net zero and sustainable finance targets.

Pushed to at least stop funding fossil fuel expansion, executives maintained that it's not that straightforward.

"This is a complex transition. We are not getting off fossil-based fuels immediately," said McKay, who, as head of Canada's largest bank and largest oil and gas funder, was asked the most questions.

Executives said they have to keep funding fossil fuels, as well as cleaner energy sources.

"We have to do both," said TD Bank Group chief executive Bharat Masrani.

"We have to support oil and gas industry, responsible oil and gas industry, as we go through this orderly transition. And at the same time, make sure we are providing the capital in the to move to a net zero world."

In a press conference ahead of the testimony, several environmental groups thanked the committee for its leadership in summoning bank executives, and called on legislators to put in regulations to force banks to take more action on climate change.

While the banks have made various commitments, they aren't moving fast enough, and haven't said how they plan to achieve those targets, said Julie Segal, senior manager of climate finance at Environmental Defence.

“While each of the Canadian banks have climate commitments, none of them have a commensurate plan of action," said Segal.

"Their voluntary climate commitments have proven fickle, with them continuing to overinvest in oil and gas and underinvest in clean climate solutions."

The appearance of the bank executives comes a week after testimony at the same committee by the CEOs of Canada's biggest oil and gas producers, which face a proposed legislated cap on emissions.

Parliamentary efforts to rein in the banking sector's indirect impact on climate are largely limited to Independent Sen. Rosa Galvez's proposed Climate-Aligned Finance Act, which remains in the Senate banking committee.

While there's disagreement on the rules and choices needed to make the energy transition happen, there was some agreement at least on the need to move faster.

"There is anxiety in the country about making this transition, and therefore Canada has to move and keep moving forward," said McKay.

"We have to accelerate that transition."

This report by The Canadian Press was first published June 13, 2024.

Companies in this story: (TSX:RY; TSX:BMO; TSX:TD; TSX:BNS; TSX:CM)

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