Global banks need to follow to save Indonesia’s rainforests
On Monday February 20th, 2017, HSBC published a ‘No Deforestation, No Peat, No Exploitation’ policy covering its financing of palm oil companies. The move by HSBC – Europe’s largest bank and a major funder of palm oil companies – follows an investigation by Greenpeace that linked it to companies destroying Indonesia’s rainforests. According to the ForestsandFinance.org website, HSBC invested almost USD 1.4 billion in loans and underwritings in palm oil companies operating in South East Asia, between 2010 and 2016.
In its new policy, HSBC has made stronger commitments to refuse finance for companies that clear forests and peatlands. If adopted across the banking sector, the policy would play a part in ending the role of banks in financing destructive palm oil companies.
The new policy will require HSBC customers to:
- Commit to protecting natural forest and peat by 30 June 2017.
- Identify and protect forests and peat in new plantations prior to commencing new development.
- Provide independent verification of their No Deforestation, No Peat, No Exploitation commitments by 31 December 2018.
HSCB is taking an important leading role with this initiative, but other banks need to follow to save Indonesia’s rainforests.
This post is also available in: Indonesian