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Environmental sustainability

Major Canadian Banks' Digital Emissions Remain Massive Amid Decline in Transparency

Strategic Insights

— 1 min read

Canadian banks, once touted as leaders in sustainability, have quietly withdrawn from the Net Zero Asset Managers Initiative, citing regulatory complexity and competitive pressures. Amidst this, new provisions under the Competition Act, Bill C-59, aim to strengthen accountability for greenwashing and misleading environmental claims. Researchers at HEC Montréal have conducted a study to quantify the environmental impact of nine Canadian banks, revealing that digital emissions far outstrip their overall carbon footprint. A striking performance gap highlights the need for banks to improve their digital sustainability, as 77% of their emissions come from traffic acquisition, with paid social media driving 58% of emissions despite generating only 1% of total traffic.

Key Takeaways:

  • The five biggest Canadian banks (CIBC, TD Bank, Scotiabank, Royal Bank of Canada, and BMO) have significant digital carbon footprints, with most emissions coming from traffic acquisition (77%) rather than website usage (23%).
  • Three of the nine banks analyzed account for two-thirds of the total emissions, indicating a significant performance gap among institutions.
  • Paid social media campaigns generate 95% of emissions associated with paid traffic, despite accounting for only 5% of total visits to a bank's website.
  • Online advertising, particularly social media campaigns, is a major hidden pollution source, with a visitor coming from online advertising emitting 418 times more carbon dioxide than one from organic sources.
  • The worst bank emits twice as much carbon per visitor as the best, highlighting the need for banks to improve their digital sustainability.

Statistics:

  • 77% of digital emissions come from traffic acquisition among Canadian banks.
  • 23% of digital emissions come from website usage among Canadian banks.
  • 95% of traffic emissions come from paid traffic.
  • Paid social media is responsible for 58% of emissions while generating only 1% of total traffic.
  • A visitor coming from online advertising emits 418 times more carbon dioxide than one from organic sources.
  • Three of the nine banks analyzed account for two-thirds of the total emissions.

Sources:

  • The Conversation -- Canada -- By Sylvain Amoros, Adjunct Professor, Department of Marketing, HEC Montréal
  • Victor Prouteau, who at the time of this study was an M. Sc. student at HEC Montréal, co-authored this article.

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