Wells Fargo recently withdrew its 2030 and 2050 financed emissions reduction targets and has not disclosed an alternative strategy for managing risk associated with these emissions.[1] The bank’s actions create an information vacuum that prevents investors from evaluating whether Wells Fargo is fully identifying and addressing its climate-related financial risk. Among these risks, climate-related litigation exposure represents an increasingly material threat to Wells Fargo— particularly given the bank’s position as the fifth largest financier of high carbon activities in the world.[2]

Climate attribution science and global legal precedents are strengthening the basis upon which financial institutions can be held accountable for their contributions to climate-related damages. Researchers can now quantify companies’ contributions to climate impacts and related economic losses. A study published in Nature demonstrates this capability: using emissions data from major fossil fuel companies, peer-reviewed attribution methods, and empirical climate economics, researchers calculated trillions of dollars in economic losses attributable to emissions from individual carbon majors.[3] Recently, a court accepted attribution evidence and allowed a climate case to proceed on that basis.[4]

This scientific advancement alters the legal landscape for institutions that finance climate-damaging activities. By financing carbon majors whose emissions can now be directly traced to specific harms, banks like Wells Fargo may face claims that their lending decisions have contributed to climate-related harm.

Climate cases are already proceeding against banks. A recent lawsuit against BNP Paribas explicitly alleges that the bank’s financing of high-carbon sectors makes it complicit in climate damages.[5] Similarly, a case filed in the Netherlands claims that ING Bank is violating Dutch duty of care principles and European human rights law by financing high-carbon sectors.[6]

Other climate-related decisions are further altering the legal landscape. The International Court of Justice and the Inter-American Court of Human Rights recently issued advisory opinions finding that states have legal obligations to reduce greenhouse gas emissions and protect the environment and humans from climate-related harms, including through the regulation of high-carbon activities.[7],[8] Although non-binding, these opinions reinforce states’ legal duties to act and the strength of climate science.

As attribution science strengthens and courts increasingly accept the causal link between financing decisions and climate damages, Wells Fargo's substantial financing of high-carbon activities, combined with its retreat from financed emission targets, creates material litigation risk. Comprehensive assessment and disclosure of these litigation risks and potential mitigation actions are essential for shareholders to assess Wells Fargo's risk management capabilities and long-term strategy.

[1] https://www.reuters.com/sustainability/climate-energy/wells-fargo-drops-financed-emissions-target-amid-esg-rethink-2025-02-28/

[2] https://www.bankingonclimatechaos.org/wp-content/uploads/2025/06/BOCC_2025_FINAL4.pdf

[3] https://www.nature.com/articles/s41586-025-08751-3

[4] https://blogs.law.columbia.edu/climatechange/2025/06/19/what-lliuya-v-rwe-means-for-climate-change-loss-and-damage-claims/

[5] https://www.climatecasechart.com/document/notre-affaire-a-tous-les-amis-de-la-terre-and-oxfam-france-v-bnp-paribas_1736

[6] https://www.climateinthecourts.com/dutch-climate-campaigners-sue-the-netherlandss-largest-bank/

[7] https://elaw.org/historic-international-court-decisions-on-climate

[8] https://www.iisd.org/articles/deep-dive/icj-advisory-opinion-climate-change