Better climate data, better business decisions

The Co‑operative Bank provides retail banking services nationwide. As a 100% New Zealand–owned and customer‑owned bank, it focuses on delivering long‑term value for customers, communities and the wider economy. Its purpose-led model recognises sustainability as a strategic driver, with a focus on social and environmental performance, transparency and accountability.​​​​ 

The challenge 

The earlier carbon management programme delivered useful insights. However, it relied on external capability and had an extended audit cycle. This limited the usefulness of information for governance, decision-making and reporting. 

The introduction of mandatory climate-related disclosures underscored the need for greater rigour, faster turnaround and defensible data. Stakeholders also signalled through the first materiality process that climate risk was a growing concern, but sought clearer evidence of how this risk was being managed and how emissions were being reduced. This highlighted the need for a more mature, integrated approach to emissions measurement, reduction planning and external assurance. 

The approach 

The bank strengthened its approach through more robust measurement, clearer ownership and alignment with recognised standards. This included working with Toitū Envirocare to support emissions measurement, target setting and external assurance. This enabled the development of a more comprehensive and internally owned emissions inventory, the setting of science-aligned targets, and improved quality and defensibility of its disclosures. 

To accelerate maturity, sustainability leadership was formalised through the Strategy function, enabling stronger ownership and clearer accountability across the organisation. Target-setting approaches, supported by Toitū and used alongside Science Based Targets initiative (SBTi) methodologies, helped the bank define a 1.5°C aligned target of a 42% reduction in Scope 1 and 2 emissions by 2030. This also provided a transparent mechanism to evaluate operational changes with the senior leadership team. 

The bank extended its measurement approach to include financed emissions, measuring the climate impact of its mortgage portfolio for the first time in FY25 and expanding this to treasury activities in FY26. Environmental considerations were integrated into the updated materiality assessment and Partnership for Carbon Accounting Financials (PCAF) guidance was used to build capability across teams in the management of financed emissions. 

The impact 

By FY25, the bank had achieved a 48% reduction in Scope 1 and 2 emissions from its FY23 baseline – three years ahead of schedule. This step change was driven by strategic operational decisions, including consolidating the data centre footprint into a more energy-efficient shared facility, transitioning the fleet to EVs and PHEVs, upgrading to energy-efficient lighting and property consolidation. These changes have delivered operational efficiencies and strengthened the resilience of core infrastructure. 

Approximately 90% of the operational emissions footprint sits within Scope 3 – largely from commuting, business travel and cloud use. While these are difficult to influence, steps have been taken, including setting a well-below 2°C-aligned Scope 3 reduction target of 33% by 2033 from an FY23 baseline. Actions include optimising cloud consumption practices and launching the Workride ride-to-work benefit scheme, which has been positively received by staff and is supporting behaviour change. 

The carbon programme and emissions reduction targets are a key pillar of the transition plan, which outlines strategic actions to support business decarbonisation, climate risk management and contributions to a low-emissions economy. Improved quality and timeliness of climate data enable clearer governance decision-making. 

Strengthened climate governance practices now include science-aligned carbon targets, climate scenario analysis, risk assessments and the integration of climate metrics into strategy. Senior leaders review progress against the transition plan quarterly and reporting provides regular updates to stakeholders, including in the annual Climate Report.  

This shift has also changed the nature of internal discussions. As CFO Bevan Miller notes, with stronger data and clear targets, the bank is better equipped to understand its transition pathway and make decisions that support both financial sustainability and emissions reduction. 

What’s next 

In 2026, the bank will continue to strengthen sustainability capability across the organisation, embed climate considerations in decision-making, and explore new levers to reduce operational emissions, including low-carbon commuting incentives.  

It has recently advanced its understanding of physical climate risk by updating flood modelling across its mortgage portfolio, which will support more climate-resilient lending practices. 

These initiatives form part of a longer-term approach to managing climate-related risks and opportunities and reinforce the commitment to help customers bank better every day.