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Blog : BOARD TALK

HSBC Faces Consumer Anger On Palm Oil Financing

Posted on February 13, 2017 at 12:00 PM

HSBC, Europe’s biggest bank, is facing "a consumer backlash" from their customers over their ongoing financing of palm oil companies destroying Indonesia’s rainforest, according to latest information compiled by Greenpeace and YouGov.


A few weeks ago Greenpeace published a report called 'Dirty Bankers' - it said that despite having policies which they claim ‘prohibit the funding of deforestation’, HSBC had been financing some of the most destructive palm oil producers in Indonesia, responsible for destroying scarce orangutan habitat, labour abuses, and increasing fire risk through rainforest clearance and illegal drainage.


Since then, 120,000 people in the UK have signed its petition calling on HSBC to stop financing deforestation. They include 30,000 HSBC customers, says Greenpeace.


In a statement it says: "Due to the unusually long-term, stable relationship between banks and their customers, Greenpeace decided to ask petition signatories whether they were HSBC customers or not, and 25% of the UK signatories have affirmed that they are."


Greenpeace also commissioned YouGov to poll UK adults on their attitudes to controversial lending practices by banks. 75% of those with their main bank account with HSBC said they would be concerned if their bank was ‘financially supporting companies who cut down trees in rainforest to assist palm oil production’, and 50% with their main bank account with HSBC said they would consider moving their account.

 

“When we launched this campaign, we were worried that people might be uncomfortable with getting involved if it was their bank lending money to companies that destroy rainforests. But it turns out that the opposite is true. People are particularly motivated when it’s their own bank doing the wrong thing. They want get stuck in, and thousands of customers have sent a clear message to HSBC that they need to clean up their act." said Jamie Woolley, Forest Campaigner for Greenpeace UK.


It is not just that ESG concerns are increasingly becoming commonplace - and taken as a 'given' for a younger generation. For some of my writing on that, see my page on Forbes - or just Google 'Dina Medland ESG Forbes.'


But the palm oil trade is clearly also an issue involving climate risk. Climate Related Financial Disclosure For Business: An Imperative For 2017 I wrote at the start of the year.


The Task Force on Climate Related Financial Disclsoure has just ended its public consultation : watch this space.

Categories: Behaviour, ESG, Risk