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Banks challenged to fight climate change
New BankTrack position paper outlines how international banks should deal with climate impact of their operations
Utrecht, Bali, Dec 12 2007
International banks are key financiers of activities and operations that contribute to climate change. Therefore, banks must take up their responsibility and adopt stringent policies and practices that will reduce their negative climate impact and make them contribute to positive change. To do so requires hard choices of banks, especially regarding their involvement in the fossil fuel sector.
This is the key message of a new paper launched today by BankTrack, the international network of NGOs monitoring private banks. The paper, 'A Challenging Climate; what international banks should do to combat climate change' outlines the key elements of a advanced bank policy on climate change:
Banks should disentangle themselves from activities and projects that substantially contribute to climate change. They should cease supporting all new coal, oil and gas extraction and delivery, new coal-fired power plants and the most harmful practices in other GHG-intensive sectors.
Banks should then minimize the extent to which their other activities contribute to climate change. They should assess and report on all Greenhouse Gas emissions associated with their loans, investments, and other financial services; establish stringent portfolio and business-unit emissions reduction targets and time lines, and develop the necessary tools to address climate issues across the full range of their operations and services.
Finally banks should increase their support for the development and use of climate-friendly technologies and production processes by increasing support for emissions reduction technology, renewable energy production and energy efficiency in all business lines, and by developing products and services that will help retail and other customers to address climate change.
The report also lists which energy projects BankTrack considers 'solutions' (wind, small hydro, solar, biomass and several other technologies) and those which must be considered 'false solutions' (nuclear power, large hydro, sustained use of gas, biofuel) to meet the climate challenge.
The report especially singles out nuclear power as a no-go area for banks eager to diversify their energy portfolio, clearly stating the climate challenge does not provide opportunity for a revival of the nuclear industry.
The release of the report at the time of the Bali Climate summit (COP-13) is part of ongoing efforts by BankTrack and its member groups to influence energy investment decisions of banks, away from fossil fuel exploration, development and (coal power) generation, towards low/no carbon energy options.
"All large banks nowadays seem to have a climate initiative of sorts; but these barely scratch the surface of what really needs to happen. At the end of the day, the continued financing by banks of new oil and gas development projects the world over will be seen by an increasingly critical public as amounting to complicity in climate destruction" says Johan Frijns, coordinator of BankTrack
Financing new coal power plants must quickly become a thing of the past" says Becky Tarbotton, Climate campaign coordinator with the Rainforest Action Network. "The business potential of financing the energy shift towards renewable is staggering; what looked like a niche market only a few years ago is now turning into a fast growing multi billion dollar industry. All the signs point towards an essential shift to a low/no carbon economy to protect the climate; smart banks will get out of coal and go for that market."
"Banks, because of their role of financiers in virtually every sector of society could play a major role in helping to combat climate change", Sebastien Godinot of Friends of the Earth France commented. "Imagine what would happen if banks would insist on climate commitments of all their clients, in the same way as they routinely assess them on other business aspects - it would provide a major boost to decarbonise the economy"
"Too many things pass for solutions to the climate crisis these days, nuclear power being one of them ", says Heffa Schuecking of Urgewald. "But you can't solve the climate crisis by creating another crisis. Nuclear power will make future generations pay dearly for our unwillingness to make hard choices today."
Rainforest Action Network Website
Netherlands/network comments: Johan Frijns, coordinator BankTrack; cell: +31 6 12421667 / +31- 24 3220317 / +31 30 2334343
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