USled political backlash has driven banks39; ESG retreat
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LONDON, Jan 24 Reuters BNP Paribas is rethinking sustainable finance to focus on profitable deals and on redefining what it considers sustainable, a senior executive said, as it became the latest bank to distance itself from the ESG label.

The shift in the French bank39;s corporate and institutional banking CIB division is to ensure sustainable finance does not come at the expense of profitability, Constance Chalchat, the division39;s chief sustainability officer, said.

After initial enthusiasm for Environmental, Social and Governance ESG investment, subpar returns have prompted a widespread rethink.

Campaigners against ESG have drawn impetus from U.S. President Donald Trump39;s return to the White House.

In his first few days in office, Trump has pushed back against ESG areas such as diversity. On Thursday, he accused Bank of America and JPMorgan Chase of not doing business with conservatives.

Chalchat said the bank wanted to stick with investment it linked to a sustainable future and helping companies and societies adapt to climate change, but needed to ensure investor returns.

We want to remain relevant for the long run, even for U.S. investors, and to realign profitability and sustainability, Chalchat said.

PRESSURE AND RESOLVE

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