Is HSBC really the right bank to lead the new “sustainable finance” rules?
The UK-based lender has one of the longest criminal records in the banking industry and is one of many large banks that ostensibly aims to green global finance.
HSBC has another scandal.This time, nothing Make financing of Mexican drug dealers easier. or Facilitate money laundering by Islamic terrorists. Or rigging Commodity price, Currency swap or Benchmark interest rate. or “Misleading” small business customers about financial products that are completely inappropriate. Or for that matter, Help the world’s richest individuals and families avoid taxes anywhere in the world, Including allowing its Swiss customers to withdraw “large amounts of cash,” usually a foreign currency that is rarely used in Switzerland.
No, this time the UK-based (but mainly Asia-oriented) bank is accused of trying to downplay climate change actions through its role as a guiding member of the industry-led alliance of banks and financial institutions, which is allegedly committed to avoiding disasters . That’s right: According to reports, HSBC is now trying to prevent action against climate change while trying to instill itself in the hearts of global citizens.
Allegedly, HSBC wrote to the Net Zero Banking Alliance (NZBA) on behalf of 12 large banks, including three of the world’s four largest fossil fuel funders (JP Morgan Chase, Citigroup, and Bank of America), requesting the alliance to relax restrictions and postpone the final Time limit, lest banks have to commit to far-reaching climate action.This is according to New report Bureau of Investigative Journalism (BIJ):
These calls came from an email sent by the HSBC Chief Executive’s Office to the Net Zero Banking Alliance (NZBA), which was initiated by Mark Carney, the former Governor of the Bank of England. NZBA brings together more than 50 banks, including HSBC, Bank of America, Barclays Bank and Santander, and requires them to set a goal to reduce the carbon emissions of their loans and investment portfolios to net zero by 2050, and to 2030.
The email sent on behalf of 12 banks stated that they should have 3 years to sign the NZBA commitment before setting the 2030 target, instead of 18 months. It attempts to further weaken the promise by abandoning the requirement for science-based goals…
HSBC has been one of Europe’s largest funders of fossil fuels, investing £17.3 billion in the industry in 2020 and helping the world’s most polluting companies raise £10.3 billion. This email came from the office of Noel Quinn, the chief executive of HSBC, who is also the chairman of the Financial Services Task Force (FSTF) convened by Prince Charles.
When the working group was first established this year, HSBC staff coordinated the 12 member banks of the FSTF. Quinn stated that the FSTF is “committed to accelerating the banking industry’s efforts […] Towards a net-zero economy.” But instead of speeding up its efforts, the coalition lobbied to extend the deadline and opposed the mandatory use of science-based scenarios to set goals.
Hold pollution funders accountable
Since the Paris Conference in 2016, some of the world’s largest banks and asset management companies that have been financing the world’s largest polluters for decades have not only put forward ideas on how to rewrite financial rules to improve economic sustainability; they Took over the entire show as a transnational institute Recent warning In its most recent report COP26: Financiers responsible for polluters:
Since reaching an agreement in Paris at the end of 2015, different types of financial companies have been working to develop methods for banks, investment funds, insurance companies and other institutions to respond to the threat of a deeper climate crisis. Now, it is controversial that most of this work forms part of the official procedures of the United Nations. Not only that, these companies are not only invited to contribute to the event, but are actually responsible for implementing the UN agenda on private financing and climate change. At the end of COP26, lights will be turned off and doors will be closed. Companies such as BlackRock, Bank of America, Citigroup and Santander will take over from there.
Perhaps this change in events shouldn’t be surprising. Over the past few decades, according to the agenda, the tendency of the United Nations system to form alliances with various large business groups has become increasingly apparent. In terms of climate change, we found that the “zero emission race” movement is at the core of allowing companies to directly participate in international decision-making, especially in the oil and gas industry, where the oil and gas methane partnership is at the core of this effort. This approach is sometimes called multi-stakeholderism (or corporate multi-stakeholderism), and it has now reached the private financing agenda of global climate change negotiations and has been taken to the extreme.
In some respects, when COP26 sees a large number of financial companies committing to “net zero by 2050,” people will appreciate it. Hundreds of financial institutions have signed an alliance of companies convened by the United Nations, promising to do their part in tackling climate change. But there are three serious problems with this approach: First, the promise is too vague to open the door to potential large-scale greenwashing. Banks, asset management companies, and investment funds with specific ambitions that hold large amounts of fossil fuels and do not change their course can use the United Nations program to strengthen their image. Second, the risks of private financing in the overall structure may be used by high-income countries to reduce their own fiscal commitments. Third, companies not only sign declarations and make promises, they are actually taking over the entire exhibition.
HSBC itself will have a significant impact on litigation procedures through its role as one of the only seven banks “Primary” banks In the Glasgow Net Zero Financial Alliance (GFANZ), Industry-led and convened by the United NationsA consortium of more than 450 private banks and financial institutions. The group was established in April with a mission to completely reform the role of global and regional financial institutions as part of a more comprehensive plan to “transform” the global financial system. To this end. , It said it will provide more than $130 trillion in financing from now to 2050.
The other six major banks of the organization are Santander, Natwest Group, Macquarie, Bancolombia, Citibank and Bank of America. The chief executives of BlackRock and the London Stock Exchange Group are also involved in the decision of the group.
Citi was the second largest bank provider of fossil fuel business from 2016 to 2020. Climate Disorder Bank Report; Bank of America is fourth [the league table of the 60 biggest financers of fossil fuel activities is on pages 7-8 of the report and is well worth a perusal]In other words, the financiers of the two largest global polluters in the world are now helping to rewrite the laws of global finance, ostensibly to promote the transition to a net-zero economy. The new rules being formulated will also intensify the financialization of nature and further erode the national sovereignty of developing countries. Write Investigative reporter Whitney Webb.
Funding activities that damage the environment
As for HSBC, it has a long history of funding activities that damage the environment. It showed almost no signs of wanting to change this behavior.
In 2012, the bank Be eliminated Provided funding to four Malaysian logging companies accused of causing widespread deforestation and human rights violations. Recently, it is one of the few large global banks, including JPMorgan Chase, BNP Paribas, Deutsche Bank, Rabobank and Bank of China. exposed Provide funding to 20 agricultural companies with the most serious violations related to deforestation. Global Witness surveys indicate that financial institutions in the United Kingdom, Europe, the United States, and China may have received US$1.84 billion in revenue from their investments in destructive agricultural companies. The analyzed transactions totaled US$157 billion and were reached since the signing of the Paris Climate Agreement in 2016, when many banks and investors vowed to make their lending practices in line with their established goals.
The survey highlights that there is still a clear disconnect between the public commitments that many banks promote heavily and their actual lending and investment decisions and actions. The biggest offender was JPMorgan Chase, which conducted a transaction worth 9.38 billion U.S. dollars. HSBC is the UK’s largest destructive agribusiness financing institution, and it has concluded a transaction valued at US$6.85 billion.
“The commodities that cause tropical rainforest destruction are beef, soybeans and palm oil crops. All of these are very costly,” said Kenza Bryan, author and investigator of the Global Witness report. “Without the support of the financial system, these commodities would not be produced, nor would they be produced on deforested land, so we demonstrated all the ways the financial sector and the City of London promote tropical deforestation.”
In January of this year, HSBC face Shareholders put pressure on them to strengthen their commitments to reduce loans to fossil fuel-related companies and turn their climate “ambitions” into binding targets.In this regard, the bank promise The financing of coal-fired power generation and coal mining will be phased out in advanced economies by 2030 and in the rest of the world in 2040.However, the commitment will not extend to the lender’s US$612 billion asset management department, which According to the Guardian will invest Companies planning to build more than 70 new coal-fired power plants in developing countries.
Green and wild
At the same time, HSBC has been placing billboards in major cities in the UK, emphasizing the importance of climate change. These advertisements were seen at bus stations in Bristol and London in October 2021, showing images of wind turbines and tree wheels, claiming to plant trees and reaching “net zero”, and the slogan “Search HSBC Sustainability“. What the ad doesn’t mention is that HSBC is 13th largest fossil fuel funder on the planet with The world’s sixth largest plastic supply chain lender. Similarly, the largest three are Bank of America, Bank of America first, Citigroup second, and JPMorgan Chase third.
HSBC’s shameless green washing behavior triggered a strong backlash.Site Adfree City Submitted a formal complaint Sued the British Advertising Standards Agency (ASA) for the bank’s “misleading outdoor drifting advertising”.The bank’s office in Canary Wharf also Targeted April by Extinction Rebellion activists. On the other side of the planet, Ava Shearer, a 17-year-old snorkeling coach from Port Douglas, Queensland, filed a complaint with the Australian advertising regulator, accusing HSBC of promoting “misleading” advertisements for its Great Barrier Reef credit program.
Shearer’s actions inspired two British groups, Brandalism and Fossil Free London, to initiate a Guerrilla art movement There are a lot of spoof HSBC advertisements on more than 50 billboards and bus stops in London, Brighton and Bristol.One of the imitation advertisements contrasted HSBC’s claim to be committed to protecting the Great Barrier Reef and funding the Adani Group’s controversial Carmichael coal mine before the Queensland authorities, which belonged to the aboriginal communities of Wangan and Jagaring. Revoked their titles in 2019.
“HSBC’s advertisement claims that it is investing in the future of the Great Barrier Reef, when in fact it is investing in the destruction of the Great Barrier Reef by investing in the Adani Group and its disastrous Carmichael coal mine,” Shearer said. “By funding fossil fuel projects and investing in climate disruptors like Adani Group, HSBC has done more damage to the Great Barrier Reef than good. HSBC needs to be held responsible for their blatant greenwashing behavior.”
Strikingly, the Bank of America BNY Mellon Announce A week ago, the company will no longer provide financial services for Adani’s Australian business, on the grounds that the Indian mining group’s Carmichael joint venture does not comply with its environmental, social and governance rules. Judging from past and recent forms, HSBC is unlikely to do so.