Financial institution loans have been screened for hurt to wildlife and the local weather
© Reuters. FILE PHOTO: BRAZILIAN FARMERS BURN FOREST FOR FARMING IN THE AMAZON BASIN.
By Matthew Green
LONDON (Reuters) – Activists on Wednesday called on global banks to stop funding industrial activities that are causing animal and plant species to become extinct after a report ranked 50 lenders in sectors that pose the greatest threat to wildlife.
While European and US banks have been under pressure from regulators or environmental groups to tackle climate change for years, their role in funding economic activities that destroy biodiversity is increasingly under scrutiny.
Portfolio.earth, a network of researchers who published the “Bankrolling Extinction” report https://portfolio.earth/wp-content/uploads/2020/10/Launching-on-28th-Oct.pdf, none of the said Lenders have had adequate systems to limit the impact of their loans on the web of animal and plant life that promote human welfare.
“Banks are beginning to understand that investing in sectors that are causing climate change will hurt their returns,” Liz Gallagher, director of Portfolio.earth, told Reuters. “Banks need to understand that this also applies to the destruction of biodiversity.”
The report found that the 50 banks lent more than $ 2.6 trillion in loans and insurance in 2019 to sectors such as industrial agriculture and fisheries, fossil fuels and infrastructure that scientists say they do are major drivers of biodiversity loss.
Kai Chan, an environmental scientist at the University of British Columbia and lead author of a global study published last year that found one million species threatened with extinction, confirmed the results.
“Imagine a world where projects can only raise capital after they have shown that they are making a meaningful and positive contribution to restoring the planet’s premium and a safe climate for all? Report and which he is working towards, “he said.
Bank of America (NYSE 🙂 and Citigroup (NYSE :), identified among the 10 largest lenders, declined to comment and referred Reuters to existing sustainability pledges. BNP Paribas (OTC :), also ranked highly, said the authors had not contacted it or shared their methodology so it couldn’t comment.
HSBC, also in the top 10, said it partnered with climate change consultancy Pollination Group in August to create a “natural capital” asset management company that values resources like water . Soil and air to protect the environment.
“Climate and nature are closely related, and the financial services industry can help customers convert their businesses to low-carbon products and enable credible investments that conserve and protect nature and biodiversity,” said Daniel Klier, global director of sustainable finance at HSBC.
The banks also indicated their support for various biodiversity conservation initiatives, such as a new nature-related financial disclosure task force (https://tnfd.info) aimed at increasing transparency between businesses and the financial sector. However, some investors want more.
The report highlighted the risks associated with industrial agriculture lending, which is a major cause of biodiversity loss, especially when tropical forests in the Amazon Basin (NASDAQ 🙂 or Asia are cleared for commercial crops.
“This report from Portfolio.earth confirms what our research also shows that banks around the world still need to improve their game and develop an approach to protecting biodiversity,” said Peter van der Werf, Senior Engagement Specialist at Robeco, one in the Netherlands resident asset manager Reuters.