Major UK bank HSBC has announced new standards on lending to companies involved with the palm oil industry following a report published by Greenpeace in January this year. The palm oil industry has been linked to deforestation and the destruction of peatland around the world, as well forest fires and the decimation of the world’s orangutan populations in Indonesia.
The bank’s revised approach aligns it with the ‘no deforestation, no peat, no exploitation policy’ launched by Asia’s agribusiness group Wilmar International.
Pressure has come from the public as well as Greenpeace, with 200,000 people signing a petition delivered to HSBC head offices in Jakarta and Kuala Lumpur and volunteer campaigns outside branches in Australia, France and the UK.
In a report by the Financial Times, the bank said it would not ‘finance unacceptable impacts in this potentially high-risk sector’ and that it ‘wanted to ensure [its] customers operate in accordance to good international practice.’ The new policy will require customers to commit to protecting natural forest and peat by 30 June 2017 and identify and protect forests and peat habitats in new plantations prior to commencing new development.
‘HSBC’s commitment to breaking its ties to destructive palm oil companies is a good first step’, says Annisa Rahmawati, forest campaigner for Greenpeace Indonesia on the Greenpeace website. ‘This also sends a clear signal that other banks must follow suit’.
Words: Ellen White
If you’d like to regulate the use of palm oil in your home, try the 28 day challenge here.