We often talk about the revolving door between the fossil fuel lobby and politics – but what about between coal, oil and gas corporations and the finance sector?
Corporations like to overwhelm us with their climate credentials in the form of policy documents and long-term targets – but often the gloss is hiding ongoing profit making from climate chaos.
The big four banks in Australia are a prime example. Despite all four having made commitments to align their business with the goals of the Paris Agreement, according to Market Forces, they have provided more than $35 billion in funding to fossil fuels between 2016 and 2019.
Of course, it’s not the banks that have given away $35 billion: it’s the many people within the banks who make choices every day about policies and loans and customers. And increasingly climate activists are looking to hold boards accountable when they make these choices that accelerate the climate crisis. In May, activist investors ousted two Exxon Mobil directors over climate change. Just this week, Melbourne university student and climate activist Ashjayeen Sharif launched a bid for AGL’s board, in an effort to transform Australia’s biggest polluter to a renewable energy power house.
That’s why we commissioned UK think tank DeSmog to conduct research into the boards of Australia’s big four banks. Their analysis found that more than one in five (21%) have current or past ties to fossil fuel mining or power generation, and many more have deep ties to the carbon-intensive mining sector.
The DeSmog analysis details some of the most notable connections between bank directors and the fossil fuel industry, including Paul Sullivan, the chair of ANZ, who previously held management positions at Royal Dutch Shell, and NAB director Kathryn Fagg, who worked for a number of years at ExxonMobil.
This research doesn’t suggest any wrongdoing of particular directors. It instead points to the risk of systemic conflicts of interests across the whole financial sector, and offers an insight into who’s at the boardroom table (or on the zoom call) when banks make decisions that have massive consequences for our collective future.
Two recent developments should have sent shockwaves through these boardrooms. The first, the International Energy Agency’s Net Zero by 2050 report, called for not a single dollar more invested in new fossil fuel supply projects.
The second, the IPCC’s Sixth Assessment Report, made it clear that there is a pathway to stabilise below 1.5 degrees – but it requires immediate, deep cuts to emissions from coal, oil and gas. And it also called for a change in thinking – rather than talking up carbon budgets and gradual shifts, every tonne of greenhouse gases added to the atmosphere causes damage: “with every additional increment of global warming, changes in extremes continue to become larger.”
It’s now up to the boards of the big four banks to respond by stepping away from incrementalism and long-term targets, and take the immediate and urgent action the climate science demands.
The first test will be NAB, whose board is expected to sign off on a policy in coming weeks that will update its approach to oil and gas lending. The only credible option for a bank that proclaims to be taking both the IPCC report and the IEA report seriously is to rule out spending a single dollar more on new or expansionary oil and gas projects, and phasing out existing commitments to oil and gas projects and customers by 2030 at the latest. Yet we know that NAB gave more than $1 billion to expand the gas industry between 2016 and 2019.
Expansion of the gas industry will not just accelerate the climate crisis – fracking the Beetaloo Basin is fiercely opposed by Traditional Owners in the Northern Territory, and fracking puts local water and air quality at risk.
The choice that is made by the NAB board will have consequences for all of us and future generations. That’s why at 350 Australia we are putting everything we can into appealing to the NAB board to make the right choice – and you can get involved here: https://350.org.au/nab/