Costco, you’re a good company. Do better with your bank

In my 35 years of battling climate change, I’ve spent a lot of time taking on big bad corporations — mainly the oil companies behind the greatest crisis our species has ever faced.

So it’s with some psychic relief that my colleagues and I find ourselves engaging with a big good company, namely Costco, headquartered in Issaquah. The giant retailer deserves plaudits: It treats its customers well and its employees better, paying high wages and providing the benefits that let a job be something like a career. Even with its massive stores, it sources some local foods, and it’s worked to improve water and energy use — “a testimony to ethical capitalism,” as one observer said.

So why are 12 climate organizations across the nation — including Third Act, the climate action group for people over 60 that I helped found — suddenly turning their attention to Costco and asking it to change its ways? Well, as is sometimes the case with basically good people, Costco has gone a little astray by hanging around with the wrong crowd.

In this case, the wrong crowd is Citi. The New York bank provides the credit cards used by Costco shoppers — and it uses the money it makes, in part, to expand the world’s fossil fuel industry, the one thing scientists tell us we must stop doing. 

Citi is an egregious offender: Since the Paris climate accords, it has pumped $332 billion into fossil fuel companies and projects. It’s a massive funder of oil and gas expansion in the Amazon, and its biggest fossil fuel client is Exxon Mobil, which knew about climate change decades ago but did everything to confuse and obfuscate. Citi is providing billions to companies developing liquefied natural gas in majority Black communities in Louisiana and Texas — the biggest fossil fuel expansion anywhere on Earth.

Is any of this Costco’s fault? Not really. I imagine none of this occurred to executives as they looked for a finance partner. But it is their responsibility. Part of being ethical is associating with ethical people; a bank is just another vendor, and if you wouldn’t buy bananas from a grower who was abusing its employees, you shouldn’t buy your credit services from a bank that’s abusing the world. According to new data, Costco’s carbon footprint for its operations would grow by an estimated 85% when its cash reserves are examined, all because of the dirty banks where we believe it deposits its money.

Do they have options? Sure. Sam’s Club sources its credit card through Synchrony, a company that is not in the same league as Citi when it comes to climate destruction. 

Costco has so far insisted it won’t change its financial arrangements, citing its contract. The climate groups raising the issue with the retailer have gathered support from tens of thousands across the country, including Costco customers and shareholders, with some even traveling to its headquarters recently before its annual shareholders meeting, calling on Costco to drop Citi. But if Costco continues to insist it can’t figure a way out (and what are lawyers for?), then it should at least announce it won’t renew the contract. If it did that, Citi might change its ways and that would be a giant victory for the planet — and for Costco and its customers.

I admit a personal stake in this, even though I live a continent away from Costco headquarters in the mountains of Vermont. Almost a century ago, my beloved grandfather was the town doctor — and sometime mayor — of what was then the small shipbuilding hamlet of Kirkland, much later to become Costco’s first headquarters. My father grew up there, in the kind of charmed American boyhood that now seems distant — but that I recall every time I pick up a bottle of Kirkland olive oil or shave with a Kirkland razor. I want that pleasant feeling unshadowed by thoughts of planetary destruction and environmental racism. I want a decent company to be thoroughly decent.