Green Finance Dips
Fresh research has revealed that international financial centres are stepping back from environmental finance initiatives, spurred by a worldwide pullback following Donald Trump’s resurgence in the US presidency.
The 15th edition of the Z/Yen Group’s Global Green Finance Index (GGFI) highlighted the downgraded sustainability ratings for major hubs, signalling a retreat from climate-focused investment strategies.
Despite maintaining its top position in the index, London experienced a significant drop, with its rating decreasing by 36 points to 598, highlighting the pervasive impact of the changing political climate.
Zurich and Singapore followed closely, securing second and third places with scores of 597 and 592 respectively, indicating a tight race amid the overall decline.
Professor Michael Mainelli, Chairman of the Z/Yen Group, said: “US influence, demonstrated by the effect on the GFCI 15 from the new administration pulling back from climate commitments shows how shallow green finance waters remain.”
A key policy of Trump’s administrations, both in 2017 and 2025, was the withdrawal of the US from the Paris Climate Agreement, an international accord aimed at curbing global warming.
Trump’s 2024 presidential campaign, characterised by the slogan “drill, baby, drill,” signalled a renewed focus on expanding US oil and gas exploration, further undermining climate commitments.
Mainelli also suggested that the withdrawal of support from North America has opened up opportunities for Asia and Europe to take the lead in green finance.
New York saw the most significant decline among the top 20 cities, with a 47-point drop, while Los Angeles and Washington DC also experienced substantial losses, falling by 43 points.
The decline wasn’t limited to the US, as European cities also saw reductions, indicating a global trend away from green finance initiatives.
The World Bank, a major international development organisation, has also adjusted its climate approach, reflecting the US’s reduced emphasis on climate programs.
World Bank President Ajay Banga has emphasised the importance of energy resources like nuclear power and natural gas, aligning with the Trump administration’s energy priorities.
Major UK lenders, including FTSE 100 giants Barclays and Natwest, have also scaled back their green initiatives, removing climate targets from executive bonus schemes. HSBC has further delayed its net-zero emissions goal by 20 years, illustrating a broader shift away from ambitious climate targets within the financial sector.
