Our path to 2035: Transparent targets. Climate action.

Join the change

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The time for decisive climate action is now.

As a customer-owned bank, we know climate action is a top concern for our customers, and it’s one we share.

We know that reducing emissions is just the first step, and we’re committed to demonstrating leadership to support climate advocacy and climate justice.

We first launched our climate action strategy in 2022. As part of our 2026 climate action strategy update, we've introduced new 2035 emissions reduction targets for our mortgage portfolio, car loans and operations, replacing our previous target of net zero emissions by 2035 and 2030 science-based interim targets.

The 2026 update also includes our first public climate-related transition plan, which outlines our approach for 2027-2029 across three key areas:
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Read Bank Australia's 2026 climate action strategy

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Our emissions reduction targets

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Our climate action strategy update in 2026 maintains our commitment to emissions reduction with a change from an overarching net zero by 2035 target to three 2035 emissions reduction targets, all from a 2026 baseline.

Residential mortgage portfolio: 70% emissions reduction by 2035
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The majority of our emissions come from our residential mortgage portfolio. Our target is aligned with a 1.5°C pathway* and was developed considering the Science Based Targets initiative Buildings Target Setting Tool, using the sectoral decarbonisation approach. We measure progress using known and estimated energy consumption data for our residential mortgage portfolio.

*Our target is set to meet the level of decarbonisation needed for the upper range of ambition of the Paris Agreement (1.5°C pathway) at 2035. The target end-point at 2035 is aligned with the 1.5°C pathway. Our emissions are expected to exceed the pathway from 2027-2030. From 2030 onwards, emissions are expected to drop below the 1.5°C pathway as the impacts of grid decarbonisation and additional action to grow climate-aligned lending take effect.

Motor vehicle loans portfolio: 40% emissions reduction by 2035
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Our target is aligned with a 1.5°C pathway and was developed considering the Science Based Targets initiative Corporate Near-Term Criteria (April 2026), using the absolute contraction approach. We measure progress using known or estimated energy consumption information of our motor vehicle loan portfolio.

Operational emissions: 40% emissions reduction by 2035
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Our target is aligned with a 1.5°C pathway and was developed considering the Science Based Targets initiative Corporate Near-Term Criteria (April 2026), using the absolute contraction approach. We measure progress using a combination of methodologies, which rely on publicly available emissions factors from Australian government agencies or third-party providers, and emissions reporting from our suppliers.

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Climate opportunities

We aim to grow climate-aligned lending and to reduce emissions from our residential mortgage portfolio, vehicle loan portfolio and our operations.

We’ve maintained our responsible banking policy position to not lend to coal, gas or oil extraction or fossil fuel electricity generation.

We plan to continue supporting customers to buy, build or retrofit all-electric homes running on renewables. This includes continuing to offer our flagship Clean Energy Home Loan and providing the Electrify Your Home program, a free initiative to support Bank Australia customers to get off gas at home.

We demonstrated our leadership by ceasing car loans for new fossil fuel cars from 2025, and will maintain this commitment.

We continue to operate on 100% renewable electricity, which we started doing in 2019. We have been reviewing remaining owned property with gas connections, and will be transitioning our vehicle fleet. We will work with our suppliers to improve on our data quality, continue to undertake sustainable site fit out activities, and explore sustainable aviation fuel and reducing business travel where possible. We'll also continue to learn how we can support our staff to reduce emissions when they commute to and from work.

Each year, we'll measure and report on the amount and percentage of our climate-aligned assets.

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Climate risks

We will continue to evolve our approach to assessing, disclosing and managing the risk presented to the bank by a changing climate.

We plan to continue to assess and manage credit risk in the mortgage portfolio as a result of climate-related transition and physical risk, and considering how we can integrate climate-related transition and physical risk information in key risk management processes.

We're also investing in capability to meet regulatory requirements and to monitor the emerging regulatory and compliance landscape, including continuing to partner with external experts where required.

Each year, we'll measure and report on the amount and percentage of our assets vulnerable to climate-related physical and transition risk.

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Climate engagement

We aim to engage with our customers, staff, suppliers, peers, governments and communities on climate.

We support advocacy on all-electric, energy efficient and resisilient homes and climate justice, including First Nations leadership on climate and a fair and inclusive energy transition.

We’ve also partnered with a range of organisations addressing the climate crisis from different angles, with the collective aim of supporting a diverse range of communities in the energy transition while working towards a clean energy future for all.  

Each year, we'll measure and report on the amount of impact fund support of climate action and number of impressions across our climate-related content and communications.

Together with our customers we are committed to taking the climate action we know is needed.

Two Bank Australia customers talking to each other