Macquarie Group has been accused of touting green credentials while taking stakes in high-growth oil and gas companies.
Billions of dollars in oil and gas undermine the investment bank's net zero commitments, according to a report by the Institute for Energy Economics and Financial Analysis.
Known as the millionaire factory, Macquarie has almost $5 billion invested in oil and gas companies that will produce gigatonnes of greenhouse gases from new developments, the research released on Thursday found.
"Our analysis finds that Macquarie Group's actions directly contradict its climate commitments," institute CEO and co-author Amandine Denis-Ryan said.
The shares and bonds include $3.5b across 11 oil majors with expansion plans that are incompatible with the international pact on limiting global warming.
There is also about $1.4b invested as significant stakes in smaller oil and gas companies.
The report also found the target Macquarie has set for its oil and gas activities could encourage the financing of new gas projects so as to cut the average emissions intensity of the fossil fuel portfolio.
The investments identified add up to about $5b, while the group disclosed only $1.2b of financing exposure across the oil and gas value chain.
These numbers are significantly larger than the disclosed exposure by Australia's largest banks, that is CBA ($2.1b), NAB ($1.9b) and Westpac ($1.9b), the report said.
In contrast, Macquarie is upfront about green energy investments in the net-zero and climate risk report to shareholders.
Macquarie signed up to the international Net Zero Banking Alliance in 2021, which committed the group to having a lending and investment portfolio in line with limiting global warming to below 1.5 degrees.
CEO Shemara Wikramanayake is also on a working group within the influential Glasgow Financial Alliance for Net Zero that formed during the 2021 climate talks in Glasgow.
GFANZ describes itself as "a global coalition of leading financial institutions committed to accelerating the decarbonisation of the economy".
The IEEFA report said the bank has since invested heavily in oil and gas, including the controversial Beetaloo Basin gas project that is Australia’s largest undeveloped gas resource.
Investments since joining the alliance were listed as including a five per cent stake in Beach Energy and $15 million in finance to Empire Energy for Beetaloo.
The bets on oil and gas were also found to be bad financial investments, despite a short-lived spike in performance in the past few years.
Further, new gas developments in coming years could face a supply glut when uncontracted supplies hit the market.
