, SONGDO, S. Korea, 8 Mar – An alliance of Asian people’s movements joined over 170 civil society groups worldwide, in calling for the main UN Green Climate Fund (GCF) to reject the partnership bids of HSBC and Crédit Agricole.
“If the Green Climate Fund is serious about helping developing countries cope with climate change, it must not partner with dirty energy funders like HSBC and Crédit Agricole,” said Lidy Nacpil, coordinator of the Asian Peoples’ Movement on Debt and Development (APMDD) and active observer for Southern civil society in the GCF board.
- HSBC channeled almost €8 billion while Crédit Agricole gave around €7 billion to the coal sector between 2005 and April 2014, according to BankTrack data.
- Both banks also financed non-fossil-fuel sectors with a large negative impact on climate.
“We urge the GCF Board, which is now holding its 12th meeting in Songdo, Korea, not to approve their application for accreditation as financial intermediaries.”
On the eve of the GCF board meeting in Songdo, Monday, APMDD and other groups released a statement detailing the two banks’ well-documented involvement in recent money laundering and other scandals, their large exposure to coal and other polluting industries, and their anti-people and anti-environment policies.
The groups stated that HSBC and Crédit Agricole rank among the top 20 private sector banks financing coal. HSBC channeled almost €8 billion while Crédit Agricole gave around €7 billion to the coal sector between 2005 and April 2014, according to BankTrack data.
Both banks also financed non-fossil-fuel sectors with a large negative impact on climate, citing HSBC as a major financier of palm oil in Indonesia’s.
“HSBC is bankrolling dirty and harmful energy as a major financier of Indonesia’s palm oil sector. The logging and burning of rainforests and peatlands for palm oil has led to a lot of carbon emissions. It has also displaced entire communities and farmlands,” said Jefri Saragih, executive director of Sawit [Palm Oil] Watch, an APMDD member organization based in Bogor, Indonesia.
The GCF was founded under the United Nations climate convention to redistribute money for climate adaptation and mitigation from developed to developing countries. Over $10 billion is currently pledged to the fund. If the GCF board approves the banks as their “accredited entities”, they will be able to receive and disburse funds to support adaptation and mitigation in developing countries.
The groups also noted in their statement that the vast majority of GCF resources are expected to flow through international and developed-country entities, even though the funds are supposed to prioritize national banks and other institutions, particularly those in developing countries.
“The Green Climate Fund Board must reject HSBC and Crédit Agricole. Creating new business for big banks with large fossil fuel portfolios and poor records on human rights and financial scandal would undermine the very purpose of the Fund,” said Karen Orenstein of Friends of the Earth U.S.
“To accredit HSBC and Crédit Agricole is to short-change the vulnerable communities and the countries that the Fund is meant to directly benefit. There is no profit to be made in building the resilience of those adversely impacted by climate change. Public funds must be used to support local communities in developing countries, not to subsidize big banks,” said Sam Ogallah of the Pan African Climate Justice Alliance.
“Accrediting HSBC and Crédit Agricole would be inconsistent with both the Paris Agreement, and with upholding high human rights standards. Any private sector partner of the GCF must have a credible strategy in place to make its entire portfolio and operations consistent with keeping global temperature rise to no more than 2 °C, let alone well below 1.5 °C,” said Annaka Peterson of Oxfam.
“The accreditation of these banking giants would jeopardize the reputation of the Green Climate Fund and expose it to unnecessarily high fiduciary risk. HSBC and Crédit Agricole provided US$7 billion and US$9.5 billion, respectively, to the coal industry between 2009 and 2014, and their coal financing does not show a clear downward trend. Moreover, HSBC is deeply embroiled in massive financial scandal,” said Yann Louvel of BankTrack.
A U.S. judge recently ordered the release of a report by an independent monitor overseeing the cleanup of HSBC’s massive money laundering — the report is said to be so damning that it would provide a “road map” for criminals seeking to launder money and finance terrorism.