On January 28th the Swiss National Contact Point (NCP) for the OECD Guidelines accepted the specific instance filed by the Society for Threatened Peoples (STP) against Swiss Bank UBS related to the bank’s business relationship with Hikvision, a company that is aiding China’s mass surveillance and genocide of  Uighurs. This is the first OECD NCP complaint to focus on a financial institution’s asset management business and passive products. Up until now, the NCP procedure has focused on asset owners’ direct shareholding or banks’ mainstream lending. In its assessment, the Swiss NCP concluded that “a direct link between UBS’s products and services and the alleged human rights violations could not be excluded”. The Swiss acceptance of the case is significant because it represents the first time an NCP has recognized the responsibility banks have for their passive investments through indexed funds.  In recent years, the asset management industry has seen a significant shift towards passive investment strategies, by which funds are typically invested in an index rather than in actively traded shares. Currently, over USD 10 trillion is invested in passively managed funds globally, so the recognition of banks’ responsibility for addressing impacts caused by these investments is important. However, on a second element of the complaint, the Swiss NCP concluded that no business relationship between UBS and Hikvision exists in relation to UBS’s role as custodian for Hikvision…

Today 263 community and not-for-profit organisations from around the world urged the CEOs of 25 banks not to participate in loans to fund the construction of the world’s longest heated crude oil pipeline. In an open letter, organisations from 49 countries, including 122 African-based organisations, detail the immense threats that the 1,445-kilometer-long East African Crude Oil Pipeline (EACOP) would pose to local communities, water supplies, and biodiversity in Uganda, Tanzania, Democratic Republic of Congo and Kenya. They also warn that the pipeline – proposed by French oil company Total and the China National Offshore Oil Corporation – will fuel climate change by transporting oil that will generate over 34 million tons of carbon emissions each year. The letter to the three banks acting as financial advisors for the project – Standard Bank, Sumitomo Mitsui Banking Corporation, and Industrial and Commercial Bank of China – and 22 banks that have recently provided finance to Total and CNOOC, comes as speculation mounts that a Final Investment Decision (FID), which would commit Total to mobilize capital for the project, is imminent. Nearly a third of the pipeline will run through the basin of Africa’s largest lake, Lake Victoria – which more than 40 million people depend on for water and food production. It will also cross more than 200 rivers, run through thousands of farms and cut through vital wildlife reserves. The pipeline is expected to cost around $3.5 billion. Of this, about $2.5…

On 1 March, Citi announced a new commitment to reach net zero greenhouse gas emissions for its financing by 2050, but put off providing key details, instead promising an initial plan “within the next year.” Citi announced that its net zero plan will include “emissions reduction targets for carbon-intensive sectors that also have low-carbon transition opportunities, including interim emissions targets for 2030 for our Energy and Power portfolios.” Citi has been the world’s third largest banker of fossil fuels in recent years, pouring US$ 188 billion into the sector from 2016-2019. The announcement comes on Jane Fraser’s first day as CEO of the bank, and makes Citi the third major U.S. bank, following Morgan Stanley and Bank of America, to make an explicit commitment to achieve net zero financed emissions by 2050. JPMorgan Chase previously pledged to align its financing with the goals of the Paris Agreement. Wells Fargo and Goldman Sachs are now the only two major U.S. banks without a similar commitment. In response, Sierra Club financial advocacy campaign manager Ben Cushing released the following statement: “It’s good to see Citi’s new CEO making big climate commitments on her first day, but today’s announcement is simply an IOU for the real plans and actions that will be needed to achieve net zero emissions by 2050. Despite citing ‘an urgent need for collective action’ in response to the climate crisis, Citi does not provide specifics on how it will get…

- US investors hold 58% of institutional investments in the coal industry - Commercial banks providing more money to the coal industry than in 2016 - Japanese banks are top lenders, Chinese banks top underwriters Today, Urgewald, Reclaim Finance, Rainforest Action Network, 350.org Japan and 25 further NGO partners published groundbreaking research on the financiers and investors behind the global coal industry. “This is the first time anyone has attempted to analyze commercial banks’ and institutional investors’ exposure to the entire coal industry. In past years, the scope of our financial research was limited to around 200 coal plant developers. Our new research, however, analyzes financial flows to all 934 companies on the Global Coal Exit List (GCEL),” says Katrin Ganswindt, head of financial research at Urgewald. Top Institutional Investors in the Coal Industry In January 2021, 4,488 institutional investors held investments totaling USD 1.03 trillion in companies operating along the thermal coal value chain. Among the investors covered by the NGOs’ research are pension funds, mutual funds, asset managers, insurance companies, hedge funds, commercial banks, sovereign wealth funds and other types of institutional investors.  The world’s largest institutional investor in the coal industry is the US mutual fund company Vanguard with holdings of almost USD 86 billion. It is closely followed by BlackRock, which holds investments of over USD 84 billion in the coal industry. Together, these…

In May 2020, European Commissioner for Justice Didier Reynders announced that the European Commission will embark on proposing legislation on mandatory human rights and environmental due diligence in 2021, a necessary step for corporate governance and accountability. In light of this, on 18 February 2021, 79 organisations across Africa, the Americas, Asia and Europe have come together and sent a letter to the European Commission, demanding that the proposed  legislation: Ensures corporate respect for human rights and international humanitarian law in conflict-affected areas; Applies to all companies in the European Union (EU), including financial institutions, their operations and relationships abroad; Ensures the protection of Indigenous peoples and the right to self-determination; Adopts a gender-sensitive approach; and, Is compatible with already-existing international norms and relevant developments directed at enhancing corporate accountability, particularly those at the United Nations. The organisations underscore that such legislation is necessary to close the severe gap between corporate-related violations against human rights and the environment and the lack of accountability, especially in conflict-affected and high-risk areas. The letter urges the European Commission to consider relevant UN precedents such as the UN database of businesses involved in illegal settlements in the occupied Palestinian territory; the Panel of Experts report to the UN Security Council regarding the illegal exploitation of natural resources…