Civil Society Organizations urge financial institutions to adopt strict no fire policies, ahead of expected strong El Niño

Ahead of a forecasted strong El Niño in the 2026/2027 period, more than 100 civil society organizations from across the globe — including TuK INDONESIA — sent an open letter to a number of global financial institutions. The letter highlights the link between financing for high-risk forestry and plantation sectors and the growing threat of forest and peatland fires, and urges banks to strengthen no-fire and no-deforestation policies across their financing portfolios.

Contents of the letter follows:

13 July 2026

Dear CEO, 

We, representatives of social movements, non-governmental organizations, organized collectives, organizations of indigenous peoples, traditional communities, Afro-descendant peoples, socio-environmental and climate researchers and activists, express our concern regarding the reports and mathematical projections that point to extreme climate events associated with the El Niño phenomenon in the 2026/2027 period. According to news released by the US National Oceanic and Atmospheric Administration (NOAA) and the UN World Meteorological Organization, El Niño is predicted to intensify to a moderate/strong level this year and could cause extreme weather conditions. 

Over the last decade (2016-2025), banks have provided 429 billion dollars in credit to activities related to the exploitation of timber, soy, rubber, pulp and paper, palm oil and beef. Sectors which are responsible for commodity-driven deforestation of tropical forests. It is well established that these agricultural and forestry activities contribute to the risk and impact of fires and haze through the use of fire in their land management systems, deforestation and draining peatlands. These practices induce vicious feedback loops by drying out the forests and peatlands, creating tinder-box conditions which enable fires to spread rapidly. 

As a result, tropical forest countries are facing increased vulnerabilities as climate change exacerbates extreme weather events and the El Niño cycle. The disruptions from the El Niño cycle are expected to be most severe in the tropics, with predictions that increased wildfires and drought could hit agriculture and food production. When forests and peatlands burn, the consequences reach far beyond the fires or even the country borders. In Southeast Asia and South America, peak fire seasons produced harms that have accumulated over years. The most severe and well-documented impacts are:

• Forest and peatland fires are a significant driver of climate change.
• Toxic haze kills people and overwhelms public health systems.
• Biodiversity loss from fire is severe and largely irreversible.
• The economic losses are enormous and chronically underestimated.
• Forest and peatland fires destroy food systems and livelihoods of forest dependent communities.

We would recommend that your financial institution takes immediate action to address the risk of forest fires linked to your financing by: 

• Strengthening No Deforestation or Conversion, No Peat and No Exploitation policies to reduce deforestation and degradation in tropical ecosystems. This includes the prohibition of the use of fire in any activities.
• Engage clients in forest-risk sectors to confirm they do not use fire in their activities, or allow it within their supply chain. 
• In cases where clients do not comply, restrict financial services or terminate the relationship.
• Advise its clients and companies linked to agricultural economic activities to increase care, adding support to fire brigades in their regions; 
• Encourage credit and financing for sustainable activities such as agroecological production and agroforestry systems intended for food; 
• Refrain from providing new finance, from refinancing or underwriting services to companies or corporate groups that have been held legally responsible for forest and peatland fires, until all court-ordered obligations, restoration commitments, and compensation measures have been fully implemented. 

Respectfully,
Coalition of CSOs

The full original letter can be downloaded here.

This post is also available in: Indonesian