In early 2025, some of Canada's largest banks - including those with the highest digital emissions and greatest responsibility - withdrew from the Net Zero Asset Managers Initiative .
Authors
- Sylvain Amoros
Adjunct Professor, Department of Marketing, HEC Montréal
- Sylvain Senecal
Professor of Marketing and RBC Financial Group Chair of E-Commerce, HEC Montréal
These major institutions, with digital carbon footprints that are disproportionately large, cited regulatory complexity and competitive pressures for their departure . This move has intensified questions from investors, policymakers and the public about their commitment to sustainability.
At the same time, Bill C-59 , adopted in late 2024, introduced new provisions under the Competition Act to strengthen accountability for greenwashing and misleading environmental claims.
The timing is striking: as Ottawa tightens disclosure rules, the same large banks that dominate digital emissions are stepping away from voluntary climate commitments. This tension between voluntary pledges and federal accountability underscores the growing pressure on financial institutions to prove - rather than simply promote - their environmental performance.
Digital carbon footprint
For decades, banks have presented themselves as leaders in sustainability through renewable energy financing and ambitious environmental, social and governance commitments . Yet their recent departure from climate coalitions - coupled with their outsized digital carbon footprints - represents an alarming reversal.
We recently conducted a study of the environmental impact of nine Canadian banks including the big five: CIBC, TD Bank, Scotiabank, Royal Bank of Canada and BMO. Our recent study sought to quantify banks' environmental impact through their digital carbon footprint .
Banks are pillars of our economy and society, possessing both the power and responsibility to lead the transition toward a more sustainable economy. However, their recent withdrawal from the Net Zero Asset Managers Initiative, coupled with ongoing concerns about greenwashing, raises legitimate questions about their true commitment to sustainability.
In this context, our goal as researchers is to provide both bank clients and financial institutions with crucial information about their environmental impact. Understanding the environmental footprint of banks' digital operations is essential, as this often-overlooked aspect constitutes a significant portion of their overall carbon footprint.
We analyzed public data from 2024 to measure the carbon impact of Canadian banks' digital practices. Our study examined two main dimensions:
1) Website usage (the energy consumed by website loading, data transfers and hosting) and;
2) Traffic acquisition, which includes all marketing activities that bring visitors to these sites, such as email marketing, paid advertising search engine optimization and social media campaigns.
The objective was to compare carbon emissions among different banks, assess their efficiency per visit and provide transparent information to the public. By identifying the most polluting areas in digital operations, we provide recommendations for improvement.
Social media activity
Our study uncovered significant findings about Canadian banks' digital environmental impact. Most strikingly, we found a performance gap where the worst bank emits twice as much carbon per visitor as the best; just three banks account for two-thirds of total emissions.
To clarify, "traffic acquisition" refers to the process of attracting visitors to a website - whether through paid ads, organic search results, or social media content. Organic traffic comes from users who find a bank's site naturally through search engines, social media or content marketing, while paid traffic is generated through advertising placements.
The data reveals that 77 per cent of digital emissions come from traffic acquisition versus only 23 per cent from website usage. Paid traffic drives 95 per cent of traffic emissions despite being a small fraction of total traffic, while organic traffic accounts for just five per cent of emissions.
Paid social media is particularly problematic - responsible for 58 per cent of emissions while generating only one per cent of total traffic.
In other words, social media ads are highly inefficient from a carbon perspective: a visitor coming from online advertising emits 418 times more carbon dioxide than one coming from organic sources .
These results expose online advertising - especially social media campaigns - as major hidden pollution sources.
A hidden source of pollution
These findings highlight how online advertising - particularly social media campaigns - can become a major source of digital pollution . The reality is clear: every click has a carbon cost.
Banks can improve their inbound marketing, meaning strategies that attract users organically through relevant content, search optimization and user experience improvements rather than through paid ads.
Transparency and sustainable digital practices are essential for greener banking - practices that reduce emissions without sacrificing innovation or competitiveness.
After withdrawing from the Net Zero Asset Managers Initiative and maintaining public net-zero commitments, many banks continue to generate significant emissions through their digital operations.
This raises a critical question for regulators, investors and consumers alike: will banks leverage their considerable resources to lead on sustainability, or continue to delay meaningful action?
Our next study will assess whether these institutions uphold their commitments or persist in their current practices, despite the escalating climate urgency.
Victor Prouteau, who at the time of this study was an M. Sc. student at HEC Montréal, co-authored this article.
The authors do not work for, consult, own shares in or receive funding from any company or organisation that would benefit from this article, and have disclosed no relevant affiliations beyond their academic appointment.
