Royal Bank of Canada has decided to drop its commitment to achieve C$500 billion in sustainable finance by 2025. This significant shift comes as a response to amendments in Canada's Competition Act, which now require businesses to provide concrete evidence for environmental claims, restricting RBC's capability to report certain sustainability metrics. As Reuters reported, the bank cites these regulatory changes as a key reason for reevaluating their sustainability objectives.

During an internal review, RBC identified discrepancies in how it previously measured sustainable finance activities. Recent adjustments to Canada's Competition Act have further complicated the situation by limiting the bank's ability to publicly share detailed metrics, such as the balance of financing low-carbon versus fossil fuel projects. Despite the lack of public disclosure, RBC will continue to track these figures internally, maintaining a focus on environmental impact.

In addition to altering its public reporting, RBC has exited the Net-Zero Banking Alliance, a decision that echoes actions taken by other major Canadian banks and has stirred debate among climate advocacy circles. This move occurs alongside an ongoing investigation by Canada's Competition Bureau, examining allegations that RBC misrepresented its climate commitments in advertising. These developments underscore the ongoing complexity financial institutions face in navigating the intersection of sustainability ambitions and evolving regulatory pressures.