HSBC triggers investigation into its own palm oil client
Thousands of hectares of rainforest saved after HSBC triggers investigation into its own client
LONDON: Action taken by HSBC, which triggered an investigation into the subsidiary of one of its own clients in the palm oil sector, has resulted in thousands of hectares of primary rainforest in the heart of Papua being given a second chance.
It follows Greenpeace and the Environmental Investigation Agency (EIA) writing to four banks (HSBC, ABN Amro, ING and Rabobank), all of which had recently helped set up a new $750m bond issued by Noble Group on March 9, 2017. The NGOs presented the banks with a suite of evidence showing that Noble Plantations, part of Noble Group, was preparing to clear 18,000 hectares of primary forest for palm oil.
The company has been ordered by industry body, the Roundtable on Sustainable Palm Oil (RSPO), to stop work until the investigation is complete. If Noble does not comply, it would face sanctions from the RSPO, including possible expulsion.
This is the first time a major bank has requested an RSPO investigation into one of its clients.
Noble Plantations has been exposed numerous times in the past for clearing forests and violating the rights of local and Indigenous peoples.
All four banks have palm oil policies that prohibit funding of companies destroying primary or High Conservation Value (HCV) forest, with HSBC bowing to Greenpeace and public pressure to produce a stronger ‘no deforestation’ policy in February 2017.
Jamie Woolley, from Greenpeace UK, said: “After years of turning a blind eye, the financial sector is finally starting to take a tougher line on rogue palm oil companies. HSBC’s decision to do the right thing and trigger an investigation into its own client could save thousands of hectares of pristine rainforest. If other banks are serious about stopping the destruction of rainforests for palm oil, they need follow suit and take responsibility for their clients’ behaviour.”
Audrey Versteegen, from the Environmental Investigation Agency, said: “The RSPO now has a canvas of 18,000 hectares of primary forest in Papua on which to sketch out the meaning of ‘certified sustainable palm oil’. Noble’s destructive plans must be sent back to the drawing board and the assessors, upon whose flawed environmental audits these plans were based, rooted out of RSPO certification.”
Like many other companies involved in the palm oil sector, banks rely on the RSPO’s standards to reduce their exposure to destructive companies – but countless investigations by civil society organisations have shown that the RSPO’s system is not working. RSPO safeguards are routinely and widely flouted by members, resulting in massive deforestation and conflict with local communities.
The NGOs are calling on other banks to take responsibility for their clients’ behaviour and for the RSPO to overhaul its regulations, known as the Principles & Criteria, to bring them into line with the ‘no deforestation, no peat, no exploitation’ standards adopted by most major brands and commodities traders.
For further information, please contact:
* Greenpeace Press Office, alison.kirkman[at]greenpeace.org / tel: +44 (0) 20 7865 8255
* EIA Press Office: paulnewman[at]eia-international.org / tel: +44 (0) 20 7354 7960.
- Noble Plantations, part of the Noble Group, is clearing primary rainforest on its PT Pusaka Agro Lestari (PT PAL) concession in Papua. This is one of two concessions owned by the company and covers more than 38,000ha, most of it classed as primary forest. By 2016, Noble had cleared 6,500ha of primary forest. Another 18,000ha was set to be destroyed by the company before the RSPO issued the stop work order. Evidence presented to the banks is available at https://www.dropbox.com/sh/cb73t73lembtx0v/AABBAapt4hgoETXazag7960pa?dl=0.
- The Roundtable on Sustainable Palm Oil was set up in 2004 to establish clear ethical and ecological standards for producing palm oil.
- Palm Oil Policies:
ABN Amro: https://www.abnamro.com/en/images/Documents/040_Sustainable_banking/070_Sustainability_policy/ABN_AMRO_Summary_agri-commodities_policy.pdf
- Greenpeace’s report Dirty Bankers: http://www.greenpeace.org/international/Global/international/publications/forests/2017/Greenpeace_DirtyBankers_final.pdf) and EIA’s briefing Noble Savages HSBC’s Noble Intentions
- EIA briefing on HSBC and Noble, April 2016: https://eia-international.org/wp-content/uploads/EIA-Noble-Savages-HSBC%E2%80%99s-Noble-Intentions-FINAL.pdf