Wall street ties to Amazon depletion mapped out in report
Bloomberg News
,(Bloomberg) -- Some of Wall Street’s biggest banks aren’t properly accounting for the risks of doing business with oil and gas companies operating in the Amazon rainforest, according to a study by conservationists.
The report, published by Stand.earth Research Group, identifies six banks it says are responsible for almost half of all direct financing for oil and gas operations in Amazonia over the past 20 years.
JPMorgan Chase & Co., Citigroup Inc., Itau Unibanco Holding SA, Banco Santander SA and Bank of America Corp. have failed to “fully address the adverse impacts of their financing,” the researchers said. The sixth bank — HSBC Holdings Plc — was singled out for having improved its policies.
“Most of these banks claim to uphold human rights and environmental protection, but, with the exception of HSBC, they continue to finance the operations of state-owned and private oil and gas companies in Brazil, Peru, Colombia and Ecuador,” the report’s authors wrote.
A spokesperson for JPMorgan said the bank supports human rights and screens for “sensitive business activities.” Spokespeople for Citigroup and Bank of America referred to their latest risk-management policies, which spell out due diligence requirements and explain expectations that clients are to meet.
Itau Unibanco said by email that it’s “working to tackle deforestation.” A spokesperson for Santander said the bank understands “fully the importance of protecting the Amazon,” and is working with clients.
A spokesperson for HSBC, which ceased financing oil and gas projects in Amazonia in 2022, said the bank’s “approach is to focus on real-world emission reductions as we support our clients in delivering the energy transition.”
Banks have taken to formulating their environmental and social risk policies in narrow terms to reduce meaningful impact assessments, according to Stand.earth and the Coordinating Body of Indigenous Organizations of the Amazon River Basin, an umbrella group representing more than 500 Indigenous peoples.
In some cases, the physical area for which screening is required makes up less than a fifth of Amazonia, the report’s authors estimate. Some transactions are structured in a way that makes them harder to track, the report’s authors also said. Many deals are syndicated and the level of due diligence is often reduced. Combined, the effect is to exclude almost three quarters of Amazonia from rigorous risk management, they said.
“There’s a real lack of transparency in the data,” Angeline Robertson, the report’s author and a Stand.earth researcher, said in an interview. She and her colleagues are calling on governments in the region to enact stricter regulations.
The warning comes as global temperatures blast through previous records, pushing the nine-country region that makes up Amazonia closer to environmental collapse. Degradation of the Amazon soared in the first four months of this year due to increasing fires and a lack of preventative monitoring, Brazilian environmental officials said last month.
The organizations are calling for banks to support the global agreement that targets protecting 80 per cent of the Amazon. The organizations also said the banks should immediately stop new oil and gas project financing and phase out existing agreements by the end of next year. What’s more, they want banks to halt financing for oil and gas traders.
“We are literally living in a rainforest on fire, our rivers are either polluted or drying up,” Fany Kuiru, general coordinator of COICA, said in a statement. Global banks “must be held accountable.”
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