"There is no profit to be made in building the resilience of those adversely impacted by climate change," says Sam Ogallah of the Pan African Climate Justice Alliance. (Photo: Greenpeace)
Mar 07, 2016
As the Green Climate Fund (GCF), the financial mechanism for the UN climate agency, meets this week in South Korea, more than 170 civil society groups are calling on the international body to reject bids from big banks HSBC and Credit Agricole to receive and manage funds to help poorer nations tackle climate change.
Given their role in financing climate pollution and their poor records on human and environmental rights, approving the financial giants' applications would run counter to the Fund's goals, the groups say.
"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. on Monday.
"There is no profit to be made in building the resilience of those adversely impacted by climate change," added Sam Ogallah of the Pan African Climate Justice Alliance. "Public funds must be used to support local communities in developing countries, not to subsidize big banks."
What's more, "accrediting HSBC and Credit Agricole would be inconsistent with...the Paris Agreement," said Annaka Peterson of Oxfam, referring to the deal hammered out at the COP21 climate talks. "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 degC, let alone well below 1.5 degC."
Friends of the Earth, Pan African Climate Justice Alliance, and Oxfam are just three of 172 NGOs that released a statement (pdf) earlier this month arguing that offering accreditation to HSBC and Credit Agricole "would pose serious reputational and moral risk to the GCF" due to the banks' historic conduct, including:
- Well-documented involvement in recent money laundering or other fiduciary mismanagement scandals;
- Large exposure to the coal industry and other climate polluting sectors; and
- Poor-quality policies and weak compliance arrangements meant to manage the social, gender, and environmental impacts of their lending, and consequent harm on-the-ground.
For example, a report from BankTrack has shown that HSBC and Credit Agricole provided $7 billion and $9.5 billion, respectively, to the coal industry between 2009 and 2014, "and their coal financing does not show a clear downward trend," notes BankTrack's Yann Louvel.
The Fund's board meeting runs Tuesday through Thursday in Songdo, South Korea. GCF executive director Hela Cheikhrouhou told the Thomson Reuters Foundation last week that she will ask for an increase of between 80 and 120 new staff in order to meet its targets. She also said it was too early to say whether the Fund could meet the board's goal to allocate $2.5 billion in 2016.
This isn't the first time the Fund has engendered criticism from climate justice groups or frontline communities, who say developed nations, despite their role in driving global warming, have been slow to pony up the necessary--and just--financing.
Last year, environmental and social justice organizations expressed outrage when the Fund accredited Deutsche Bank, one of the world's largest financiers of coal, to receive and distribute climate adaptation and mitigation funds.
"We want the Green Climate Fund to succeed," groups wrote at the time. "But for it to do so, it needs to change direction away from accrediting controversial big banks that are heavily invested in fossil fuels and thus actually exacerbating climate change. If the [Green Climate Fund] continues in such a direction, this would reinforce our fears that in the near future we may have to protest an institution we have thus far been supportive of and integral to creating."
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Deirdre Fulton
Deirdre Fulton is a former Common Dreams senior editor and staff writer. Previously she worked as an editor and writer for the Portland Phoenix and the Boston Phoenix, where she was honored by the New England Press Association and the Association of Alternative Newsweeklies. A Boston University graduate, Deirdre is a co-founder of the Maine-based Lorem Ipsum Theater Collective and the PortFringe theater festival. She writes young adult fiction in her spare time.
africaclimate emergencycoalcorporate powerenvironmentfossil fuelsfriends of the earthhuman rightsinequalityoxfamparis agreementwall streetbig bankscop21deutsche bankpan african climate justice alliancegreen climate fund
As the Green Climate Fund (GCF), the financial mechanism for the UN climate agency, meets this week in South Korea, more than 170 civil society groups are calling on the international body to reject bids from big banks HSBC and Credit Agricole to receive and manage funds to help poorer nations tackle climate change.
Given their role in financing climate pollution and their poor records on human and environmental rights, approving the financial giants' applications would run counter to the Fund's goals, the groups say.
"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. on Monday.
"There is no profit to be made in building the resilience of those adversely impacted by climate change," added Sam Ogallah of the Pan African Climate Justice Alliance. "Public funds must be used to support local communities in developing countries, not to subsidize big banks."
What's more, "accrediting HSBC and Credit Agricole would be inconsistent with...the Paris Agreement," said Annaka Peterson of Oxfam, referring to the deal hammered out at the COP21 climate talks. "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 degC, let alone well below 1.5 degC."
Friends of the Earth, Pan African Climate Justice Alliance, and Oxfam are just three of 172 NGOs that released a statement (pdf) earlier this month arguing that offering accreditation to HSBC and Credit Agricole "would pose serious reputational and moral risk to the GCF" due to the banks' historic conduct, including:
- Well-documented involvement in recent money laundering or other fiduciary mismanagement scandals;
- Large exposure to the coal industry and other climate polluting sectors; and
- Poor-quality policies and weak compliance arrangements meant to manage the social, gender, and environmental impacts of their lending, and consequent harm on-the-ground.
For example, a report from BankTrack has shown that HSBC and Credit Agricole provided $7 billion and $9.5 billion, respectively, to the coal industry between 2009 and 2014, "and their coal financing does not show a clear downward trend," notes BankTrack's Yann Louvel.
The Fund's board meeting runs Tuesday through Thursday in Songdo, South Korea. GCF executive director Hela Cheikhrouhou told the Thomson Reuters Foundation last week that she will ask for an increase of between 80 and 120 new staff in order to meet its targets. She also said it was too early to say whether the Fund could meet the board's goal to allocate $2.5 billion in 2016.
This isn't the first time the Fund has engendered criticism from climate justice groups or frontline communities, who say developed nations, despite their role in driving global warming, have been slow to pony up the necessary--and just--financing.
Last year, environmental and social justice organizations expressed outrage when the Fund accredited Deutsche Bank, one of the world's largest financiers of coal, to receive and distribute climate adaptation and mitigation funds.
"We want the Green Climate Fund to succeed," groups wrote at the time. "But for it to do so, it needs to change direction away from accrediting controversial big banks that are heavily invested in fossil fuels and thus actually exacerbating climate change. If the [Green Climate Fund] continues in such a direction, this would reinforce our fears that in the near future we may have to protest an institution we have thus far been supportive of and integral to creating."
Deirdre Fulton
Deirdre Fulton is a former Common Dreams senior editor and staff writer. Previously she worked as an editor and writer for the Portland Phoenix and the Boston Phoenix, where she was honored by the New England Press Association and the Association of Alternative Newsweeklies. A Boston University graduate, Deirdre is a co-founder of the Maine-based Lorem Ipsum Theater Collective and the PortFringe theater festival. She writes young adult fiction in her spare time.
As the Green Climate Fund (GCF), the financial mechanism for the UN climate agency, meets this week in South Korea, more than 170 civil society groups are calling on the international body to reject bids from big banks HSBC and Credit Agricole to receive and manage funds to help poorer nations tackle climate change.
Given their role in financing climate pollution and their poor records on human and environmental rights, approving the financial giants' applications would run counter to the Fund's goals, the groups say.
"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. on Monday.
"There is no profit to be made in building the resilience of those adversely impacted by climate change," added Sam Ogallah of the Pan African Climate Justice Alliance. "Public funds must be used to support local communities in developing countries, not to subsidize big banks."
What's more, "accrediting HSBC and Credit Agricole would be inconsistent with...the Paris Agreement," said Annaka Peterson of Oxfam, referring to the deal hammered out at the COP21 climate talks. "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 degC, let alone well below 1.5 degC."
Friends of the Earth, Pan African Climate Justice Alliance, and Oxfam are just three of 172 NGOs that released a statement (pdf) earlier this month arguing that offering accreditation to HSBC and Credit Agricole "would pose serious reputational and moral risk to the GCF" due to the banks' historic conduct, including:
- Well-documented involvement in recent money laundering or other fiduciary mismanagement scandals;
- Large exposure to the coal industry and other climate polluting sectors; and
- Poor-quality policies and weak compliance arrangements meant to manage the social, gender, and environmental impacts of their lending, and consequent harm on-the-ground.
For example, a report from BankTrack has shown that HSBC and Credit Agricole provided $7 billion and $9.5 billion, respectively, to the coal industry between 2009 and 2014, "and their coal financing does not show a clear downward trend," notes BankTrack's Yann Louvel.
The Fund's board meeting runs Tuesday through Thursday in Songdo, South Korea. GCF executive director Hela Cheikhrouhou told the Thomson Reuters Foundation last week that she will ask for an increase of between 80 and 120 new staff in order to meet its targets. She also said it was too early to say whether the Fund could meet the board's goal to allocate $2.5 billion in 2016.
This isn't the first time the Fund has engendered criticism from climate justice groups or frontline communities, who say developed nations, despite their role in driving global warming, have been slow to pony up the necessary--and just--financing.
Last year, environmental and social justice organizations expressed outrage when the Fund accredited Deutsche Bank, one of the world's largest financiers of coal, to receive and distribute climate adaptation and mitigation funds.
"We want the Green Climate Fund to succeed," groups wrote at the time. "But for it to do so, it needs to change direction away from accrediting controversial big banks that are heavily invested in fossil fuels and thus actually exacerbating climate change. If the [Green Climate Fund] continues in such a direction, this would reinforce our fears that in the near future we may have to protest an institution we have thus far been supportive of and integral to creating."
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