Australian banks, super funds yet to pick up ball on nature risks

Published 02:57 on December 12, 2022  /  Last updated at 03:47 on December 13, 2022  /  Biodiversity  /  No Comments

The vast majority of Australian banks and superannuation funds have yet to set nature-related targets, and only a small minority of them plan to do so, according to a survey released Monday carried out by the Australian Conservation Foundation (ACF).

The vast majority of Australian banks and superannuation funds have yet to set nature-related targets, and only a small minority of them plan to do so, according to a survey released Monday carried out by the Australian Conservation Foundation (ACF).

The ACF has surveyed 20 of the country’s biggest banks and superannuation funds, and found that 90% of the funds and 80% of the banks have failed to set nature-related targets.

Even more, only 20% of them have plans to do so, the ACF found.

“Whether it’s a business destroying wildlife habitat for more cattle grazing in Queensland, or a property developer knocking over trees for more suburban sprawl, there’s always almost a financial institution bankrolling the activity,” said Nathaniel Pelle, a business and nature campaigner with ACF.

“The financial sector bears particular responsibility for reversing the nature crisis because it decides which activities are financed or insured and under what conditions,” he added.

None of Australia’s big four banks have set targets related to deforestation and land conversion, with only four of the smaller ones having done so – Bank Australia, HSBC, Rabobank, and Bendigo & Adelaide Bank, along with one superannuation fund, Australian Ethical.

The ACF report said that by now all banks and super funds should have been well underway in drawing up policies and strategies for dealing with the nature crisis.

“The [Taskforce on Nature-related Financial Disclosures] is up to its third draft and many of the tools it recommends have been around for years,” the ACF report said.

“By now banks and super funds should have at least conducted a high-level screen of their exposure to industry sectors with significant nature-related impacts and dependencies.”

Setting zero deforestation and conversion targets, integrating nature goals in climate targets, and setting a timeline for comprehensive impact and dependency reporting are also among actions they already should have taken, the group said.

Those who have yet to do so – which is almost all of them – should get started immediately, the ACF urged.

In addition, over the next 12-24 months, banks and super funds should also be expected to set time-bound targets and science-based policies to protect and restore nature for activities such as land, water, and sea use change, resource exploitation, climate change, pollution, and invasive species, it added.

“Australians want to know that they are not unwittingly financing the extinction of animals like the koala, or the collapse of rainforests, through their savings,” said Pelle.

Australia is home to around 10% of the world’s plant and animal species, though the government’s State of the Environment report released earlier this year showed that nature is being destroyed in Australia at a faster rate than in any other developed nation.

The ACF report comes as Treasury on Monday initiated a public consultation process on climate-related financial disclosure in Australia, while Environment Minister Tanya Plibersek over the weekend said she is travelling to Montreal this week to back strong action to protect nature at the ongoing biodiversity COP15.

On the sidelines of COP15, a group of global institutional investors on Sunday launched the Nature Action 100, calling on the financial sector to help address nature loss through engagement and decision making which incorporates portfolio companies’ impact on biodiversity.

By Stian Reklev – stian@carbon-pulse.com

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