On March 25, 29 organizations from 12 countries submitted a letter to 39 bond underwriters and bondholders of Japan International Cooperation Agency (JICA), requesting them to urge JICA to rule out support for the Matarbari coal-fired power plant Phase 2 project (hereinafter referred to as Matarbari 2) in Bangladesh and the Indramayu coal-fired power plant project (hereinafter referred to as Indramayu) in Indonesia. To date, 14 bondholders responded, of which 3 investors stated that they had conducted engagement with JICA and a bond index provider, and 1 stated that it would consider engaging with JICA in the future. Others provided simple acknowledgments that they received the letter. About a month later in April, JICA announced the launch of its Global-Dollar bonds guaranteed by the Japanese government (1) and non-guaranteed Domestic bonds (2), and specifically stated that it will “not knowingly allocate any proceeds from the sale of the bonds to activities related to coal-fired power generation.” When we contacted JICA staff on why such a specification was made, they said that it was because some bondholders contacted JICA on the topic of financing coal projects. This implies that JICA felt pressure from some of their bondholders’ engagements and responded to their voices. However, in contrast to the impression the JICA’s announcement gives, the funds procured from JICA bonds are deposited in its loan account, and the loans for Matarbari 2 and Indramayu will be contributed from the same account.…

From June 17-22, activists staged a global action targeting Asia’s worst banker of climate chaos, Mitsubishi UFJ Financial Group (MUFG), demanding the Japanese megabank to stop funding fossil fuels, deforestation, and human rights abuses. Actions were held in key global centers including Tokyo, Manila, Jakarta, New York, Amsterdam, and Barcelona, as well as Brazil. The actions concluded one week before the MUFG Annual General Meeting of shareholders, where its investors will vote on the first-ever climate resolution faced by the bank. Activists called out MUFG for being the worst Asian banker of fossil fuels since the adoption of the Paris Climate Agreement, with continued financing of coal, oil and gas expansion across the globe. Projects that received special attention included the controversial Line 3 tar sands pipeline and the East African Crude Oil Pipeline (EACOP), and the financing of coal power in Asia. Activists are also calling out MUFG and its subsidiary Bank Danamon for financing rainforest destruction, coal mining, and human rights abuses in Indonesia. In addition to in-person actions, activists took to social media to spread the message of MUFG’s climate-destructive financing, using hashtags like #DefundClimateChaos, #EndFossilFinance, and #DefundDeforestation. A petition of nearly 20,000 signatures was delivered to MUFG’s NYC office, demanding stronger action on forests and rights, while another petition endorsed by over 143…

 A new report by the Rousseau Institute, Friends of the Earth France and Reclaim Finance, and endorsed by 12 civil society organizations including BankTrack, reveals that major European banks accumulated EUR 532 billion in fossil fuel assets (1) – representing 95% of their total equity – and would struggle to put up with a sudden drop in their value. The authors underline the threat such a situation poses to the transition to a low-carbon economy, potentially snowballing into a financial crisis, with severe economic and social impacts. To remedy this situation, they call for State, financial regulator and central bank intervention. They put forward key regulatory and legislative measures and advocate for the creation of a European “fossil bank” to sustainably manage the fossil fuel phase-out. The report studies the balance sheet of the 11 largest banks in the Eurozone (2). It reveals that they accumulated a stock of EUR 532 billion in assets directly linked to coal, oil and gas. This stock amounts to 95% of their total equity (3). These fossil fuel assets represent a very large proportion of the equity of all banks studied, ranging from 68% for Santander to 131% for Crédit Agricole. Paul Schreiber, Campaigner at Reclaim Finance and co-author of the report, notes: “While 84% of the explored fossil fuel reserves will have to be left unexploited (4) to limit global temperatures rise to 1.5°C, thus becoming effectively stranded, European banks support companies developing new plants,…

The world’s 50 largest banks and investors are driving deforestation through weak policies and major investments in commodities which are linked to tropical rainforest destruction, according to new research by Forests & Finance –– a coalition of research groups and civil society organizations from the United States, Indonesia, Netherlands, Brazil and Malaysia. The financial institutions were scored on their performance, with major international banks like Bank of America, Sumitomo Mitsui Banking Corporation (SMBC), Industrial and Commercial Bank of China (ICBC), and major investors such as BlackRock, Vanguard, and State Street, all coming out with low scores. The newly redesigned Forests & Finance database shows that the policies of the 50+ financial institutions –– accounting for USD 128 billion in credit and underwriting to deforestation-linked commodities from 2016 - 2020 and USD 28 billion in investment as of April 2021 –– are collectively very weak, with an average score of 2.4 out of a possible 10. This indicates that the majority of financing to the different commodities driving deforestation (beef, palm oil, pulp and paper, rubber, soy and timber) is not subject to even basic desk-based social, environmental or governance checks, much less actual verification of client standards. "Protecting the world’s tropical forests has quite literally never been more important to all life on Earth,” said Merel van der Mark, Coordinator for the Forests & Finance…

Global Witness reveals today that Chinese banks are funnelling billions into agribusinesses driving global deforestation and are failing to take adequate measures to ensure their money is not contributing to environmental destruction. This news comes against the backdrop of the upcoming revision of China’s law for commercial banks. Plagued by recent corruption and mismanagement scandals, the Chinese financial sector needs better regulation not only to tackle governance issues but also to address the major gaps in environmental and social risk management exposed in our analysis. As forests are being destroyed at alarming rates around the world, our analysis shows Chinese financial institutions provided over USD 22.5 billion between January 2013 and April 2020 to major companies producing and trading commodities at high risk of driving deforestation - palm oil, soy and beef, pulp and paper, rubber, and timber. Just five of the biggest Chinese commercial banks accounted for 45% (USD 10.25 billion) of the total figure. In particular, Chinese banks are providing a lifeline to agribusinesses and commodity traders involved in the palm oil sector and Brazilian beef and soy production, which are the commodities with the highest deforestation risk. Our analysis of the specific companies they chose to finance shows many of them have problematic track records on deforestation and human rights abuses. According to our research, the companies receiving large sums from Chinese banks include COFCO, Tianjin Julong, Wilmar, ADM, Bunge,…