The Goldman Sachs Group, Inc.

RATING

SECTOR

Financial Services

WEBSITE

CONTACT

200 West Street,
New York,
NY 10282
U.S.

STOCK EXCHANGE

LISTING

  • Supplier Engagement Leader list (A score) 
  • Climate Change Leader list (A- score)
  • Ranked #93 out of 300 America’s Most Responsible Companies in News Week and Statista’s rankings 
  • EPA Green Power Partnership – Ranked #43 in the National Top 100 and Included on the 100% Green Power Users list
  • JUST Capital Ranked #111 out of 922 America’s Most Just Companies Ranked #4 out of 33 Capital Markets Companies according to JUST Capital 

EMPLOYEES

38,300

CHIEF SUSTAINABILITY OFFICER

Kara Mangone

AWARDS

  • Ranked #6 in US Transparency Awards.
  • Euromoney Awards for Excellence by America’s Best Bank for Sustainable Finance

CONTENT SOURCE

FURTHER READING

Report created by Samuel Hamway

 

The Goldman Sachs Group, Inc.

SECTIONS :  Sustainability •  Targets    Evaluation •  Key Points  •  Overview

 

Company Activity

The Goldman Sachs Group, Inc., is an American multinational investment bank and financial services company headquartered in New York City. It offers services in investment management, securities, asset management, prime brokerage, and securities underwriting. The bank operates worldwide and is a leading financial institution in the world.

The firm holds $720 billion USD in total assets. This places the firm as the 30th largest bank globally. Goldman Sachs was ranked 59th on the Fortune 500 list of the largest United States corporations by total revenue.

Goldman Sachs Group, Inc. engages in global investment banking, securities, and investment management, which provides financial services. It operates through the following business segments: Investment Banking, Global Markets, Asset Management, and Consumer & Wealth Management.

  • The Investment Banking segment serves public and private sector clients around the world and provides financial advisory services, helps companies raise capital to strengthen and grow their businesses and provides financing to corporate clients.
  • The Global Markets segment serves its clients who buy and sell financial products, funding and managing risk.
  • The Asset Management segment provides investment services to help clients preserve and grow their financial assets.
  • The Consumer & Wealth Management segment helps clients to achieve their individual financial goals by providing a wealth advisory and banking service.

Company Sustainability Activity

Goldman Sachs seeks “to manage Goldman Sachs for the long term, by supporting [its] people and increasing diversity and inclusion in our ranks, effectively managing risk, and seeking to limit [its] operational impacts around the world. Using [its] commercial expertise to catalyze innovative market-driven solutions for mitigating climate risk and capturing growth opportunities in clean energy, sustainable transport, food and agriculture, waste and materials, and ecosystem services.”

Goldman Sachs views inclusive growth and the transition to a carbon-free climate as central to its social responsibility as a top financial institution. Committing to its cornerstone initiative of a $750 billion investment over 10 years, Goldman Sachs is focused on its two pillars of advancing the climate transition and driving inclusive growth.

The broader efforts of advancing the climate transition include investment into

  • Clean Energy
  • Sustainable Transport
  • Ecosystem Services
  • Waste and Materials
  • Sustainable Food and Agriculture

In regards to driving inclusive growth, the firm broadly invests into:

  • Accessible and innovative healthcare
  • Advancing financial inclusion for all
  • Enabling greater access to education, improve learning outcomes and help close opportunity gaps for learners of all ages
  • Enabling infrastructure development, affordable housing and livelihood advancement. 

The firm is also a signatory of the UN Principles for Responsible Banking.

Highlights

  • 10-year target of $750 billion in financing, investing and advisory activity focused on climate transition and inclusive growth.
  • Source 80% renewable electricity from long-term PPAs and on-site projects by 2025.
  • 71 percent LEED-Gold certified green buildings prior to the end of 2020.
  • Procuring 100 percent of global electricity from renewable sources.
  • $66 billion in COVID-19 relief bonds raised.
  • 23% reduction in water use in facilities.
  • 23% reduction in energy use in facilities.
  •  
  • Zero net carbon emissions across their global operations and business travel since 2015
  • In 2019 they recycled 100% of their eWaste, 90% of construction waste and diverted 99% of their business waste from landfill. Over 86% of paper was procured from post-consumer recycled or certified new fiber sources and they reduced paper use per-capita by 40%, far surpassing their 2020 goal of a 20% reduction.
  • Zero percent business waste to landfill
 

Targets

2020 Targets

  • 10-year target of $750 billion in financing, investing and advisory activity focused on climate transition and inclusive growth.
  • Net-zero GHG emissions across operations and supply chain by 2030.
  • Two “diverse” board members to be targeted, one of which must be a woman.
  • Aligning financing activities with a net-zero-by-2050 transition pathway.
  • Certifying 100% of new construction as LEED-Gold certified or equivalent by 2025.
  • Lower facility energy usage by 20% by 2025.
  • Lower facility water usage by 15% by 2025.
  • Reduce energy intensity (kWh/ sq. ft.) across our operationally controlled facilities by 20% by 2025.
  • Continue to divert 100% of business waste from landfills by 2025.
  • Reduce paper consumption per capita by 30% by 2025.
  • Source 80% renewable electricity from long-term PPAs and on-site projects by 2025.
  • Eliminate plastic bottles and disposables from facilities by 2025.

Additional Targets

Greenhouse Gas Emissions/Energy/Travel

  • Reduce energy intensity by 20% from a 2017 baseline for offices under operational control
  • Extend Scope 3 carbon neutrality commitment for business travel to include hotel night stays
  • Ensure that 80% of renewable energy procurement is from long-term, impactful agreements, such as power purchase agreements or on-site generation
  • Become a signatory to The Climate Group’s EP100 initiative (Energy Productivity)
  • Become a signatory to The Climate Group’s EV100 initiative (Electric Vehicle)
  • Establish a green traveller program for Goldman Sachs employees to minimize the environmental impact of business travel

Water

  • Achieve 20% reduction in water use from a baseline for all new construction and major renovation projects
  • Reduce water intensity by 15% from a 2017 baseline for offices under operational control

Plastics

  • Remove 100% of plastic beverage bottles and disposables from on-site cafeterias, micro-markets and vending machines globally
  • Reduce the amount of firm-provided office supplies that contain plastic

Business Waste

  • Reduce internal paper use per-capita by 30% from a 2017 baseline

Events/Hospitality

  • Extend commitment to ISO 20121 certified Sustainable Event Management to include off-site events
  • Procure 100% green cleaning products for on-site cafeterias globally
  • Procure 50% sustainably sourced food for on-site cafeterias globally

Supply Chain

  • Assess 100% of global vendors for ESG risks
  • Increase spend with diverse vendors by 50% from a 2020 baseline

Progress

2020 Progress

  • 71% LEED-Gold certified green buildings prior to the end of 2020.
  • Procuring 100% of global electricity from renewable sources.
  • Reduced total business waste sent to landfill to 3%.
  • 88% decrease in plastic use since 2018.
  • 70% reduction in paper per capita consumption.
  • 69% paper per capita reduction.
  • 23% reduction in water use in facilities.
  • 23% reduction in energy use in facilities.
  • $2 billion dedicated budget for investing in green buildings and innovative green technologies.
  • $66 billion in COVID-19 relief bonds raised.

Additional Progress

  • Achieved carbon neutrality in their operations in 2015 and continued to maintain the status since then.
  • Goldman Sachs acquired Imprint Capital, a leading institutional impact investing firm and innovator in developing investment solutions that generate measurable ESG impact alongside a financial return. Since their acquisition, Goldman Sach’s dedicated ESG and impact assets have grown to $74 billion.
  • Goldman Sachs committed $750 billion in financing, investing and advisory across nine sustainable growth themes to support global climate transition and inclusive growth strategies that accelerate positive change.
  • Oct 2020: Goldman Sachs launched the green division as part of their $750 billion sustainable finance effort.

Social and Environmental – case studies from some of Goldman Sachs projects: 

    • Goldman Sachs’ sustainable finance solutions have enabled Oncoclinicas to build large-scale projects and continue investing in the most advanced technologies in cancer treatment. As an investor since 2015, their capital has helped to support growth and expansion into 25 cities in Brazil and in 2018 they became the organization’s largest shareholder.
    • Climb Credit received $50 million in lending capital from Goldman Sachs to provide financing for people to affordably learn valuable career skills with life-changing impact. The capital allows Climb Credit to expand access to career-transforming education and skills training for people with various financial backgrounds, and promote economic mobility for their users.
    • Since 2014, their loans have funded the education of over 15,000 learners and they’ve partnered with nearly 200 schools that provide training for career paths with strong earning potential in today’s economy.
    • Funds managed by Goldman Sachs have been long-time supporters of Renew Power India, beginning from the fund’s early stage investments in ReNew Power to Investment Banking Division working on three green bonds totaling to ~$1.3 billion. On the path to helping ReNew Power become India’s largest independent renewable energy company, ReNew’s business growth has also contributed 4,000+ new jobs to the Indian economy across more than 95 villages.
 

Certificates

UN Sustainable Development Goals

UN SDGs Compliance

The Impakter Index team aligns current company-wide sustainability initiatives with the UN Sustainable Development Goals in the following section.

SDG 2: Zero Hunger

  • Goldman Sachs has committed to the funding of projects including:
    • Precise and regenerative agriculture solutions.
    • Conventional to organic farmland conversion.
    • Water management practices such as drip irrigation, irrigation scheduling, storage
    • Fertilizer and herbicide input management that reduce pesticide use. 
    • Alternative protein development.

SDG 4: Quality Education

  • Goldman Sachs has committed to the funding of projects including:
      • Personalized learning tools.
      • College affordability solutions. 
      • School management systems. 
      • Workforce and critical financial skills training. 
      • Online learning. 
      • Public education (K-12, Higher Education). 
      • Early childhood education. 
      • Lifelong learning. 

SDG 6: Clean Water and Sanitation

  • Goldman Sachs has worked closely with the World Resources Institute (WRI) and GE as a founding member of the WRI Aqueduct Alliance, a partnership that brings together leading companies to address water risk through a global water risk mapping tool. In 2016, WRI released a series of reports which analyzed and assessed baseline water risks for corporations and governments using the web-based interactive mapping platform.

SDG 7: Affordable and Clean Energy

  • Goldman Sachs has committed to the funding of projects including:
    • Solar power generation. 
    • Wind power generation. 
    • Small or Run-of-River Hydropower generation (under 30 MW).
    • Geothermal power generation (under 100g CO2/kWh direct emissions).
    • Sustainable Bioenergy power generation sourced from waste products or with intensity lower than 100g CO2/kWh.
    • Energy efficiency solutions such as LED lighting, HVAC systems.
    • Smart and digital grid products and services such as battery and energy storage technology, advanced metering infrastructure, transmission infrastructure that connects renewable energy. 
    • Renewable natural gas and methane capture projects. 
    • Buildings with certifications such as LEED (Gold or above), BREEAM (Very good or above) or certifications that demonstrate equivalent energy efficiencies.

SDG 11: Sustainable Cities and Communities

  • Goldman Sachs has committed to the funding of projects including:
    • Affordable housing. 
    • Community and cultural centers that provide free or subsidized public access such as museums, aquariums, or libraries. 
    • Public parks / urban green centers. 
    • Essential services such as water and wastewater systems, public sanitation and hygiene, disaster response and relief efforts, mobile / telecom infrastructure.
    • Climate-resilient infrastructure, such as flood prevention projects.

SDG 12: Sustainable Consumption and Production

  • Goldman Sachs has committed to the funding of projects including:
    • Industrial efficiency technology development such as waste heat recovery, demand response.
    • Carbon capture, utilization, and storage projects.
    • Waste management solutions including recycling, waste-water treatment, waste-to-energy/products with appropriate waste diversion or efficiency technologies.
    • R&D for sustainable materials development including bio-based, renewable, compostable or recyclable materials.
    • Procurement and production of sustainably sourced materials.
  • The Closed Loop Fund is an innovative investment vehicle that seeks to increase recycling rates across the U.S. The partnership seeks to demonstrate that with added recycling infrastructure, increased awareness and communications and community incentive programs, there can be a measurable increase in recycling rates and job creation opportunities.

SDG 17: Partnerships for the Goals

  • Given the increasing focus on resiliency measures by policymakers and the need for greater investment in this field, Goldman partnered with other private-sector leaders on an initiative called the RE.bound Program. The initiative seeks to design a new catastrophe bond-like product that would realize the potential benefits from infrastructure improvements that have greater resiliency measures and monetize the associated physical and financial risk reductions. In addition to traditional grey infrastructure solutions, improved resiliency measures can include seawalls and green stormwater infrastructure. By identifying the financial value from enhanced resiliency, the partnership seeks to promote greater investment.

Secondary SDGs: 1, 5, 10

Evaluation

Goldman Sachs is clearly committed to implementing sustainability into its business operations. The firm publishes several reports including their Sustainability Report and Sustainability Insurance Framework Report.

The firm’s reported strategies are explicitly in line with many of the UN Sustainable Development Goals, despite not reporting as such. This is a result of being a signatory of the UN Principles for Responsible Banking, which mandates SDG compliance. 

Goldman is notably transparent in its ESG reporting. The firm offers both specific and numerical goals in its reports. Progress towards these goals is also approached in a numerical manner. Furthermore, the company’s goals are given clear years for which they are to be achieved.

The firm’s progress is noteworthy, making numerical strides towards their primary 10-year target goal of $750 billion in the financing, investing and advisory activity focused on climate transition and inclusive growth

In addition to having zero net carbon emissions across their global operations and business travel, the company has made targets to reduce their greenhouse gas emissions, water usage and plastic usage

The company has received numerous listings, awards and certificates. Goldman Sachs does comply with four of the seventeen UN Sustainable Development Goals. 

Despite their efforts, Goldman Sachs is still financing fossil fuels operations. Since the adoption of the Paris Agreement, Goldman Sachs has contributed $100.506 B to the fossil fuel industry. While the firm has decreased its investments from 2019 to 2020, its investments cannot be ignored.

They have been rated a C.

Analyst Outlook: Neutral

Although Goldman Sachs’ latest announcements and progress seem promising, it still supports the operation of fossil fuels. These activities are counterproductive to their sustainable policies.

 

Key Points

  •  Goldman Sachs recent announcements about their Sustainable Finance
  •  Goldman Sachs continuing contribution to fossil fuel financing – $59.257 B (2016–2018)
Share this Post