Two of Australia's biggest banks are turning over a green leaf.
The Commonwealth Bank and National Australia bank have updated their environmental policies to back international efforts to limit global warming to two degrees Celsius.
They also recognise the need to move away from the world's current energy mix to low-carbon and renewable alternatives.
The revamped policies come just weeks before world leaders attend a major climate change summit hosted by the United Nations in Paris.
CBA chief executive Ian Narev says the bank needs to be aware of the long-term impact of its business on the economies and communities in which it operates.
"An important part of that is rigorously and consistently examining our lending and investing decisions to understand and assess environmental and social impacts," he said on Thursday.
"The policies and practices that we are announcing today enable us to do that.
"They also provide transparency so we can be held accountable by our stakeholders for the decisions we make."
CBA will apply comprehensive environment risk management frameworks to its lending and investment decisions.
It will also use its position to influence companies that it lends to and invests in with respect to their impact on the environment.
Furthermore, CBA will support businesses and technologies that reduce dependence on fossil fuels and mitigate the effects of climate change.
In its climate change policy, NAB sets out five key commitments, including plans to devote $18 billion over seven years to addressing global warming and the transition to a low carbon economy.
It also backs a price on carbon and sourcing 10 per cent of the bank's electricity from new and additional renewable energy projects by 2018.
"NAB believes the financial sector has an important role to play in assisting the transition to a low carbon economy, through both the energy we purchase directly and through financing," its policy says.
"This transition however, needs to take place in a considered and balanced manner, supported by a stable policy environment that can underpin the transition and provide investment certainty over time."
Green group 350.org welcomed the move by the banks and said it signalled that they were committed to phasing out their support for fossil fuels.
"It's now time for the banks to walk the walk and put their commitments into practice by developing serious plans to phase-out fossil fuels," the group said.
Meanwhile, CBA and NAB have joined a group of 12 Australian companies to endorse 38 climate commitments ahead of the December summit.
The commitments entail strategic and operational decisions to transition to a low-carbon economy.
The 12 companies include Origin Energy, Infigen Energy, AGL Energy, Westpac, ANZ, Brambles and Singtel Optus.
