Climate activist group Market Forces is stepping up campaigns against NAB and ANZ over the two lenders’ continuing support for domestic and overseas fossil-fuel projects.
Market Forces claims that NAB and ANZ are increasing finance to the fossil fuel sector, which is undermining their commitments to Paris Agreement’s climate change objectives.
According to the lobby group, ANZ increased its exposure to the oil and gas sector by 8 per cent to A$19.9 billion in 2019 and expanded lending to coal miners by 7 per cent to $1.5 billion.
NAB increased its exposure to oil and gas extractors by 9.5 per cent to $4.14 billion in the 12 months to the end of March. It also more than doubled lending to gas-fired power projects to $1.17 billion.
“Nearly five years since publicly supporting the Paris Agreement, Australia’s major banks continue undermining that commitment through their financing activity,” said Market Forces spokesman, Jack Bertolus.
“They’ve continued lending to new fossil fuel projects that are entirely inconsistent with limiting global warming to 1.5°C, and banking companies whose business plans rely on the failure of the Paris Agreement,” Market Forces explain in their pitch to shareholders.
NAB and ANZ yesterday confirmed that Market Forces had listed two special resolutions to be put to a vote of each bank’s shareholders at their respective annual meetings in December.
The lobby group is calling on the boards of the Melbourne-based banks to disclose their respective strategies for phasing out lending to coal producers that is consistent with the Paris Agreement’s objective of reducing the world’s reliance on coal-fired electricity by 80 per cent before 2030.
Market Forces argues that NAB intends to phase out exposure to thermal coal mining by 2035.
In the last two years NAB has provided fresh funding to Queensland coal miner New Hope and NSW-based extractor Whitehaven Coal.
The bank came under pressure earlier this year from Greens MHR, Adam Bandt to explain how the new lending to the coal miners was consistent with its policy of not funding new thermal coal projects.
NAB responded to the Bandt’s question by saying it continued to lend to existing thermal coal mining customers.
“In November 2019, we also capped our thermal coal mining exposures at current levels and announced we would reduce thermal coal mining financing by 50 per cent by 2028, intended to be effectively zero by 2035, apart from residual performance guarantees to rehabilitate existing coal mining customers,” the bank told Bandt in a written answer.
“We also announced we will not take on new-to-bank thermal coal mining customers. “While we do not discuss the details of individual customers, our lending profile is consistent with these policies.”
In a statement filed to the ASX on Monday, ANZ said it was in the process of reviewing its environment and sustainability lending policies.
“At its ESG market briefing on 7 September 2020, ANZ flagged a suite of forthcoming policy changes would be disclosed at the time of the full year results on 29 October 2020,” the bank said in the filing.
“These policy changes will be relevant to the resolutions.”
Market Forces said it was not planning to move resolutions at the Westpac and CBA annual meetings because both banks had given commitments to manage down their exposures to thermal coal miners to zero by 2030.
“Unlike competitors Commonwealth Bank and Westpac, neither ANZ nor NAB have disclosed Paris-aligned thermal coal exposure reduction targets,” Bertolus said.
None of the major banks have indicated when they plan to terminate lending to oil and gas producers.
Suncorp, which has committed to stop lending to thermal coal producers by 2025, says it plans to phase out support for oil and gas by 2040.