As world leaders gathered in Montreal in December to work on a Global Biodiversity Framework to halt and reverse nature destruction, three of Australia’s largest banks – ANZ, Westpac and NAB – held their Annual General Meetings (AGMs). These meetings were an opportunity to call on the banks to also make bold commitments for our planet because we know that their financing directly enables pollution and nature destruction.
We were at each AGM to listen in and hold them to account on their lending that's damaging nature and our climate.
They said many things that sound promising. For example, ANZ’s Chair Paul O’Sullivan reflected that: “It's actually counterproductive for us to lend to things that are bad for the community. As a bank that would be a very short-term way to think, because if the community doesn't thrive and do well, the bank's going to be in trouble. It is actually good banking and good risk management to take account of these sorts of issues.”
But are their words backed up with action?
Thanks to community pressure from groups like ACF, this year was the first time Australia’s big banks faced questions on their impacts and dependence on nature.
NAB indicated that they “support the direction” of protecting biodiversity and preventing land-clearing through lending conditions, stating that “it is fundamentally a risk issue”. They are the only Big 4 bank which has assessed the risk and opportunities of nature loss but, like the others, NAB doesn't have a goal to disclose nature destruction or make targets to halt and reverse it.
Westpac said they were already considering environmental impacts in some agricultural loans, but it was “something we do on a case-by-case basis”, indicating there is no consistent policy that the bank applies.
ANZ initially deflected questions on land-clearing, only later admitting that that “we are now turning our minds more forcefully to biodiversity.” Of all three of the banks, ANZ appears to have given their impacts on nature and biodiversity the least consideration.
Other banks like Rabobank, Bank Australia and HSBC already have policies on deforestation, but so far, none of the Big 4 banks do. Read more in our Risky Business report.
Each of the banks have net zero targets, but according to the United Nations these claims cannot be credible unless they stop funding companies expanding the size of the coal, oil and gas industries.
The worst of the lot is ANZ. In response to questions from climate strikers, flood survivors, and financial analysts among others, ANZ said their customers involved in oil and gas need to demonstrate that their policies are aligned with the Paris Agreement.
Yet ANZ could not explain how their recent participation in a $1.2 billion loan to Woodside was consistent with their net zero commitment or the Paris Agreement. Woodside’s mammoth Scarborough Gas Project and Pluto extension would generate emissions over its lifetime equal to ten years of running all of the country’s coal-fired power stations combined.
See how all Big 4 banks compare on the related climate and nature crises on our Bank Rank page.
Simply put: banks know they need to step up, as indicated by statements of CEOs and chairpeople at the AGMs. Two things can shift them.
Financial institutions have started to recognise that tackling dependence on fossil fuels is essential in avoiding economic pain. A recent report by global re-insurer Swiss Re found 11-14% of global GDP – or US$23 trillion – could be lost unless the world meets the challenge of tackling the climate crisis.
What's more, around 49% of Australia’s GDP is moderately to highly dependent on nature. Banks will face serious losses due to land-clearing, pollution, soil degradation and other impacts on nature. This is also starting to be recognised. “The long-term sustainability of agriculture is very much dependent on ensuring environmental protection, and the encouragement of biodiversity and supporting biodiversity,” says Phil Corcoran, NAB Chairperson
As public pressure mounts for banks to tackle the interrelated and interdependent climate and nature crises together, ANZ, Westpac and NAB all need to lift the bar.
Banks will move where the market demands are, so pressure from customers and shareholders can have a powerful impact.
Over recent months, thousands of people in the ACF community have raised their voices to call for banks to lend responsibly. Through petitions, social media storms and raising questions at their AGMs.
In the new year, we will continue to rally public pressure on the financial sector because we know they can progress the transition to renewables this decade and use their power to restore nature rather than harm it.
To keep up to date on our campaign to move the money and how you can get involved, sign our petition here.
Photo: Lewis Burnett/Shutterstock.com