|[Published: Monday October 25 2021]
EU banks play 'major role' in deforestation, report finds
BRUSSELS, 25 Oct. - (ANA) - European banks and asset managers play a major role in deforestation, a new report by Global Witness shows.
Lenders based in the EU have earned a reported €401m from deforestation, out of more than €30 billion worth of deals with companies linked to logging.
- The destruction of the world’s rainforest fuels the global climate emergency and comes at a devastating cost for forest communities, who defend and depend on them. Through their backing of agribusiness, financial institutions have bankrolled and profited from this destruction.
- Banks and asset managers based in the EU, UK, US and China have made deals worth $157 billion with firms accused of destroying tropical forest in Brazil, Southeast Asia and Africa since the Paris Climate Agreement, our investigation has found.
- These financial institutions have netted $1.74 billion in interest, dividends and fees from financing the parts of agribusinesses groups that carry the highest deforestation risk – primarily soy, beef, palm oil and pulp and paper – Global Witness estimates.
- As governments, shareholders and the public start to see profits made on the back of environmental and human rights abuses as illegitimate, these vast sums could become liabilities for banks. The first known case of a bank returning profits from a problematic deal has already taken place.
- Financial giants who have repeatedly profited from these deals include HSBC, Deutsche Bank, JPMorgan, BNP Paribas, Rabobank and Bank of China.
- The US bank JPMorgan has made deals worth an estimated $9.38 billion with firms accused of deforestation, making it the biggest deforestation lender in the US, EU, UK and China, according to our analysis.
- At the heart of the problem is a failure of voluntary commitments and a lack of accountability, which means banks can make problematic deals over and over again. Communities and NGOs are testing new legal boundaries to try to hold financiers to account. However, governments in major financial centres, including the EU, UK, US and China, need to effectively regulate financial institutions and companies to end their complicity in deforestation and their ability to profit from it. - (ANA) -
AB/ANA/25 October 2021 - - -