NEW YORK (CNNMoney.com) - Goldman Sachs is embracing its inner environmentalist.

The investment banking company launched a new environmental initiative Tuesday that would require its 24,000 employees to promote eco-friendly practices and would encourage its own clients -- which include paper companies, refiners and auto manufacturers -- to use "appropriate safeguards" to protect the environment, according to The New York Times.

The move follows similar initiatives implemented by J.P. Morgan Chase (Research) and Merrill Lynch (Research) earlier this year to set environment guidelines for its different businesses. But Goldman Sachs takes it one step forward by investing $1 billion in projects aimed at generating energy from sources other than oil and gas.

Goldman Sachs (Research) also said its research department will conduct extensive environmental studies and the company will increase its carbon trading activities, which grants companies the right to emit certain levels of carbon dioxide and sell the right if they emit less than allowed, the Times reported.

Environmentalists are cheering Goldman's new shade of green, although the company stopped short of refusing to do business with clients that don't meet a stringent standard of environmental best practices.

But the company said it won't finance projects that are harmful to the environment and plans to endorse stronger financial regulation -- a move environmentalists hail as a good first step.

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