Monday, October 5, 2015
Contact: Blair FitzGibbon, 202-503-6141
Citigroup Announces Financing Cuts for Global Coal Industry;
Becomes Second Major Bank to do so After Bank of America
Rainforest Action Network Pushes for New Global Banking Trend, Urges Halt to All Coal Financing
New York – Citigroup today released a new policy to cut its lending to the global coal mining industry. The bank updated its environmental policy framework, stating that it had begun to cut its credit exposure to coal mining and that “going forward, we commit to continue this trend of reducing our global credit exposure to coal mining companies.”
This is the second major bank to cut financing for coal mining this year after Bank of America announced a similar policy in May, following years of campaigning by Rainforest Action Network (RAN) and allied groups. Europe’s third largest bank Crédit Agricole also adopted a similar commitment earlier this year, under pressure from European organizations. Citigroup’s move follows the launch of the Paris Pledge this summer, a global coalition of over 130 organizations calling on the banking sector to end its support for coal mining and coal-fired power prior to the Paris Climate Conference this year.
“We are encouraged to see Citigroup begin to move away from lending to coal mining,” said Lindsey Allen, Executive Director of RAN. “But reducing credit exposure is only a partial step forward. We urge Citigroup and Wall Street laggards such as Morgan Stanley to cut all financing ties to both coal mining and coal-fired power.”
Last month, RAN launched a new campaign calling on Morgan Stanley to end its financing for coal. And this Friday, activists will hold a nationwide day of action to spotlight the bank’s continued financing ties to some of the world’s most carbon-intensive and socially destructive coal mining and power companies. Morgan Stanley is the latest target in a series of campaigns by RAN since 2000 to hold major U.S. banks accountable for the environmental, human rights, and climate impacts of their financing decisions.
“With Bank of America, Crédit Agricole, and now Citigroup withdrawing support for coal mining, this announcement shows major momentum away from financing coal by the banking sector,” said Allen.
The Bank of America announcement in May followed four years of campaigning by RAN and other groups. This time, Citigroup moved swiftly to avoid a campaign ahead of December’s climate negotiations in Paris. Financing policy changes at both banks acknowledged that the scale of the challenge posed by climate change calls for the financial sector to transition away from financing high-carbon energy sources in addition to scaling up financing for low-carbon energy.
Earlier today, Citigroup, the parent company of Citibank, committed to take a significant, though partial step away from banking coal. The company updated its environmental policy statement, stating that it had begun to cut its credit exposure to coal mining and that “going forward, we commit to continue this trend of reducing our global credit exposure to coal mining companies.” This policy change makes Citigroup the third global bank to commit to broad industry-wide cuts to coal mining finance this year, and the first to do so since the launch of the global Paris Pledge calling on banks to end financing for coal mining and coal-fired power.
Overall, the policy change is a positive one, signaling that Citigroup is moving away from lending to an industry that is incompatible with a low-carbon future and a major contributor to climate change. However, Citigroup’s policy change leaves some major loopholes and unanswered questions:
- It is incomplete, covering only part of Citigroup’s banking relationships with coal mining companies – This commitment to reduce its “credit exposure” commits Citigroup to reduce corporate lending to coal companies, but not the bank’s continued involvement with the industry through issuing bonds and shares. This leaves a big loophole for the bank to continue to underwrite new debt and equity for coal mining companies.
- It lacks a clear timeline and phase-out commitment – Although the bank states that it has already begun to reduce its exposure to coal mining, reducing exposure is not the same as ending it. RAN will be monitoring the bank’s participation in transactions with coal mining companies closely to assess how this commitment is moving the bank towards phasing out its lending involvement with coal mining altogether.
- It does not address the bank’s financing relationships with coal-fired power – Last year, Citigroup financed $2.5 billion for the largest operators of coal power plants in the world. The bank’s policy change is silent on these transactions, a key gap, especially after Crédit Agricole announced significant cuts to coal power financing last week.
With less than two months before the Paris climate conference, we’re long past the time for incremental steps away from coal. It’s time for banks to stop financing it, period. As Anote Tong, President of the low-lying island nation of Kiribati wrote in August, the development of new coal mines “undermines the spirit and intent of any agreement we may reach…To avoid catastrophic climate change, we must leave the vast bulk of carbon reserves in the ground.”
Bottom line, time is running out for Citigroup’s competitors on Wall Street, including Morgan Stanley, to get on the right side of history on climate and coal by cutting ties to coal mining and coal-fired power.
Last week, we launched our campaign to pressure Morgan Stanley to stop cashing in on coal.1 Thanks to your action, we have their attention. Now it’s time to up the ante. Next Friday, October 9, we’ll be rallying at a Morgan Stanley branch near you.
Will you join us?
What: Rally at Morgan Stanley!
When: Friday, October 9
Where: A Morgan Stanley branch near you
We know pressure works: Just this year, you successfully pushed Bank of America to drop coal mining after a four-year RAN campaign.2 Here at RAN, we’ve been working behind the scenes to push Wall Street banks to meet or exceed Bank of America’s policy, and we’ve seen positive signs. But Morgan Stanley continues to finance coal’s worst of the worst.
Conducted half a billion dollars worth of coal deals in 2014 — and also banks Peabody Energy, the world’s largest private sector coal mining company.
Financed $1.2 billion for the largest coal fired power plant operators in the world last year — including RWE, Europe’s largest single emitter of carbon dioxide.
Continues to finance mountaintop removal coal mining, at a time when eleven of Morgan Stanley’s competitors have committed to cut financing for this horrific practice.
Coal hurts communities and kills the climate. Rally next Friday: Tell Morgan Stanley to drop it!
For fifteen years, RAN and activists like you have been holding the U.S. banking sector accountable for its environmental and human rights impacts. Together, we’ll make Morgan Stanley the next bank to commit to dropping coal.
1. "Five Reasons Why Morgan Stanley is RAN's Next Target Bank on Coal Finance," Rainforest Action Network, September 22, 2015
2. Rainforest Action Network, "Bank of America Campaign Timeline", May 6, 2015
Join us October 9th at Morgan Stanley Headquarters to deliver our demands right to the door step of Morgan Stanley. It’s past time for Morgan Stanley and the rest of Wall Street to meet and exceed these pledges by dropping financing for coal mining and coal power.
1585 Broadway Ave
New York, NY 10036
Google map and directions
We’re three months away from the crucial Paris climate conference, and some major U.S. banks have been taking the lead and committing to get out of coal.1 Here at Rainforest Action Network, we’ve been working behind the scenes to push Wall Street banks to drop coal across the board. We’ve seen positive signs from a number of banks. But in the meantime, we’ve also seen Morgan Stanley continue to finance coal’s worst of the worst.
Morgan Stanley has been banking the global coal industry’s worst corporations for years—and they refuse to face the realities of climate change. Morgan Stanley:
Conducted half a billion dollars worth of coal deals in 2014.2
Has a long-standing relationship with Peabody Energy, the world’s largest private sector coal mining company, which produced a quarter billion tons of coal last year.3
Financed $1.2 billion for the largest coal fired power plant operators in the world last year—including RWE, Europe’s largest single emitter of carbon dioxide.4
Continues to finance the horrific practice of mountaintop removal (MTR) coal mining—literally blowing off the tops of mountains to get at the coal inside, destroying ecosystems, and poisoning communities in beautiful rural Appalachia. Meanwhile, eleven of Morgan Stanley’s competitors have committed to cut financing for MTR.
For fifteen years, RAN and activists like you have been holding the U.S. banking sector accountable for its environmental and human rights impacts. Most recently, you successfully pushed Bank of America to drop coal mining after a four-year RAN campaign.5 Earlier this year, Crédit Agricole, the third-biggest bank in Europe, also adopted a major new coal policy. It’s past time for Morgan Stanley and the rest of Wall Street to meet and exceed these pledges by dropping financing for coal mining and coal power.
In the run-up to December’s vital climate conference in Paris, RAN has joined with more than 130 climate organizations worldwide to call on the global banking sector to end financing for coal mining and coal-fired power.6 We’re seeing a broad call for a comprehensive transition away from fossil fuels, from everyone from communities on the frontlines of climate change to the world’s elected officials. This is a make-or-break moment for the global banking sector to do its part in moving us toward a post-carbon economy. With the Paris climate conference less than three months away, it’s time for U.S. banks to drop coal once and for all.
1. "Bank of America Backs Away from Funding Coal Mining," Huffington Post, May 6, 2015
2. Rainforest Action Network, 2015 Coal Finance Report Card, p. 34
3. "Peabody Energy Announces Results For The Year Ended December 31, 2014”, Jan. 27, 2015
4. Rainforest Action Network, 2015 Coal Finance Report Card, p. 40
5. Rainforest Action Network, "Bank of America Campaign Timeline", May 6, 2015
6. Paris Pledge, http://dotheparispledge.org/
Embargoed for: September 22, 2015
Contact: Blair FitzGibbon, 202-503-6141
Morgan Stanley Pressured to Drop Coal Financing
Rainforest Action Network Announces Campaign as Next Major Bank Targeted Since Bank of America Coal Milestone
San Francisco – Today, Rainforest Action Network (RAN) announced that Morgan Stanley is the next major investment bank being targeted with a public campaign to demand that the bank commit to stop financing coal mining and coal-fired power.
“Morgan Stanley has longstanding financing relationships with some of the worst offenders from the global coal mining industry, including Peabody Energy, the world’s largest private sector coal mining company,” said Ben Collins, Senior Research and Policy Campaigner at RAN. “Last year alone, the bank financed $477 million for coal mining.”
Morgan Stanley continues to finance top producers of mountaintop removal coal, even as eleven of its competitors have committed to cut financing for the practice. The bank also financed $1.2 billion in 2014 for the largest operators of coal-fired power plants in the world such as RWE, Europe’s largest single emitter of carbon dioxide.
For fifteen years, RAN has been holding the U.S. banking sector accountable for its environmental and human rights impacts, most recently campaigning against Bank of America’s coal financing. Earlier this year, Bank of America and Credit Agricole both adopted new policies that took major steps away from financing coal. Now RAN is demanding Morgan Stanley and the rest of Wall Street meet and exceed these commitments by adopting comprehensive policies to end financing for coal mining and coal fired power.
In the lead up to the Paris climate conference in November, RAN has joined with over 120 other civil society groups partnered in the Paris Pledge that calls on the global banking sector to end financing for coal mining and coal-fired power. Global political and civil society leaders have called for a rapid transition away from fossil fuels. This year is becoming the make or break moment for global banks to decide how they will choose to invest in the future of energy.
Today, RAN announced our next bank target on coal financing: Morgan Stanley. With Bank of America and Credit Agricole already taking major steps away from financing coal and the Paris Climate Conference less than three months away, Wall Street banks are in a race against time to be on the right side of history on climate by dropping coal. Here are five key reasons why we’re targeting Morgan Stanley:
Morgan Stanley continues to finance some of the worst of the U.S. coal industry - The bank maintains an eyebrow-raising roster of U.S. coal company clients. Its recent loans and bonds have flowed to operators of mountaintop removal coal mines such as Alpha Natural Resources that continue to blast off the tops of mountains and force communities in Appalachia to live with dangerous air and water pollution. And among operators of coal-fired power plants, Morgan Stanley’s clients include FirstEnergy, which is currently begging regulators to force customers to bail out its fleet of unprofitable coal plants.
The bank’s finances the biggest corporate players in coal around the world - Earlier this year, Morgan Stanley helped Peabody Energy refinance a billion dollars worth of debt through the bond markets. Peabody is the world’s largest private sector coal mining company and produced 250 million tons of coal last year. The bank also finances Europe’s largest single emitter of carbon dioxide, the mining and power giant RWE. Last month, over a thousand activists occupied an RWE open-pit coal mine, halting coal production and spotlighting RWE as an example of a company that is incompatible with a low-carbon future.
Even as other banks have taken steps away from financing for coal, Morgan Stanley is moving in the wrong direction - Eleven of the bank’s peer institutions in the U.S. and Europe have committed to cut financing for money-losing mountaintop removal coal mining, but Morgan Stanley continues to throw financial lifelines to mountaintop removal producers such as Alpha Natural Resources, leading a bond transaction for the soon-to-be-bankrupt company last year.
The bank also finances coal companies that violate human rights - It’s inexcusable that nearly five years after the UN Human Rights Council published its Guiding Principles on Business and Human Rights, Morgan Stanley’s financing policy documents have major gaps on human rights. This year, the bank earned a human rights score just above failing in the 2015 Coal Finance Report Card based on its coal financing policies and practices. Morgan Stanley’s coal industry clients include Glencore, joint owner of the Cerrejon coal mine in Colombia, which has been involved with serious human rights violations against communities near the mine.
Morgan Stanley has a hypocrisy problem on climate change - Even with its coal industry ties, the bank has not been shy in promoting itself as a sustainability leader. As bank executive Tom Nides said while promoting Morgan Stanley’s new Institute for Sustainable Investing, “Morgan Stanley is about being a market leader in sustainable investing, and that’s what we intend to do.” It’s time for the bank to start walking its talk on sustainability by cutting ties to the coal industry.
Help us tell Morgan Stanley to that with the Paris Climate Conference rapidly approaching, it’s past time to stop financing coal.
In the next week, Coal India, the world’s biggest coal company, is trying to cash in with a big share offering — despite a long record of appalling human rights and environmental abuses.
But this is dirty money. Any bank that takes it is also buying into Coal India’s human rights and environmental abuses. Amnesty International reported last year that a Coal India subsidiary demolished houses to forcibly evict Indigenous and Dalit families to expand one of its mines.2
And Coal India specializes in open-pit coal mining, which means clear-cutting forests — with grave impacts for forest communities and endangered species like tigers, leopards and elephants. The company touts its reforestation program — but just this summer, a government investigation found that half of the land Coal India claimed it reforested was barren.3
Indeed, broken promises are par for the course for Coal India. The company’s most recent share offering was earlier this year. As a precondition for Goldman Sachs, Bank of America, Credit Suisse, and Deutsche Bank doing the deal, Coal India agreed to a set of environmental and social commitments that it has failed to follow through on. Now, new reports of attempts to mine tiger forests4 and displace communities5 show that the company doesn't take these commitments seriously.
We’ve seen this movie before. Any bank that does this deal risks getting burned again. Take action: Tell them it’s not worth it.
The deadline for banks submitting bids is September 23 — next week. The time to act is now. I’ve been talking to key U.S. banks to warn them away from this deal, but now they need to hear from you. Add your voice!
Recent months have seen major banks taking the lead and committing to get out of coal mining.6 So it’s bitterly ironic that other banks are even considering doing the Coal India deal now. We’re months away from the crucial Paris climate summit, and banks should be doing their part by adopting policies to drop coal — not putting themselves on the wrong side of history by cashing in with the world’s biggest coal company.
1. "Coal India Share Sale is Planned", Wall Street Journal, August 13, 2015
2. "Indigenous and Dalit communities at risk of forced evictions in Chhattisgarh", Amnesty International India, September 4, 2014
3. "50% of reclaimed coal mine area of Coal India is ‘barren’", Hindustan Times, July 12, 2015
4. "Coal winner as tiger area of 300 football fields diverted", The Times of India, September 3, 2015
5. "Chhattisgarh coal mine should not be expanded without genuine consultation", Amnesty International India, February 19, 2015
6. "Bank of America Backs Away from Funding Coal Mining," Huffington Post, May 6, 2015
When the health of our environment is compromised, the health of people is too. Often times the same bad actors that exploit our environment also refuse to give workers safe working conditions, living wages, or the right to organize. It is also working class people that occupy the most dangerous jobs and are most impacted by climate catastrophe and environmental disasters produced by exploitive industries. When labor and the environmental movements work together, however, we do more than just provide safer industry jobs. We create new opportunities that secure a future that is both just and climate-stable. Some of these victories are small, some of them are big -- but all of them help move us toward a new economy. After all, there are no jobs on a dead planet.
1. Blair Mountain Battle, Then and Now (1921)
The bloody Blair Mountain Battle is a classic story of companies exploiting workers and natural resources. Despite the coal mining company’s control over their entire lives, workers fought back for their right to safe working conditions, living wages, and union recognition. Today, West Virginia residents are fighting coal companies to end mountaintop removal and protect the historical site of the 1921 battle.
2. Donora, Pennsylvania’s Smog Problem (1940)
After factory smog became so thick that it poisoned and killed local residents, workers stood up to corporations that refused to take responsibility. Workers fought for both their own health and the health of their shared environment by taking on corporate bosses.
It was long the practice for workers to be exposed to harmful conditions, while at the same time responsible for protecting themselves. The creation of the Occupational Safety and Health Administration (OSHA) was a powerful collaboration between labor unions and environmental activists, attacking chemical industries that were poisoning both people and environments.
Deaths on the job, miserable working conditions, and one of the dirtiest ports in the United States were only some of the barriers facing activists fighting to enforce regulations in Los Angeles. Together labor, environmental groups, and public health professionals made change.
Workers in the gas and oil industry are more than six times as likely to die on the job as the average American. The concerns of the families working in the gas and oil industry are the same as those who are living outside “the fenceline:” We can’t keep our families safe when dirty industries thrive
“You cannot seriously address the destruction of wilderness without addressing the society that is destroying it."
— Judi Bari, Earth First!er, Wobbly, organizer and agitator
“Hungry and Out of Work? Eat an environmentalist!”
— Bumper sticker distributed by local union at Three Mile Island in response to anti-nuclear movement
In 1921, for five days in late August and early September, some 10,000 armed coal miners confronted 3,000 police and coal company strike breakers in a little-known historic incident known as “The Battle of Blair Mountain.” The Battle of Blair Mountain was the culmination of a massive union drive in the coalfields of West Virginia. The miners worked in appalling conditions for little pay. The collapse in coal prices following World War I, and the greed of the coal operators and Wall Street bankers, led to a new level of union-busting. The Battle of Blair Mountain was the largest armed insurrection in U.S. history since the Civil War. Strike breaking included the intervention of federal troops on behalf of the coal operators and the use of aerial bombing on the union forces in the United States. The conflict resulted in the deaths of nearly 150 people.
Eventually, militant labor movements such as the Appalachian mineworkers, and radical moments like the Battle of Blair Mountain, led to the legalization of collective bargaining and improvement of working conditions around the country.
In the past 50 years, the same coal operators have waged a war on Appalachia’s mountains and mountain communities with strip-mining techniques that includes mountaintop removal and the disposal of coal waste in the rivers and streams of Appalachia. The same companies have used the modernization of strip-mining techniques to reduce the size their workforces making their executives more money and breaking union strength (less numbers, less power).
On the 90th anniversary of the Battle of the Blair Mountain in 2011, environmentalists, labor, Appalachians, retired union miners and many other re-enacted the march on Blair Mountain. At the event, march organizer Brandon Nida stated: "The unions protect [workers] in the workplace and environmentalists protect them at home. They're the same."
Over the years, labor and environmentalists have not always gotten along harmoniously. Unions often advocating for their members find themselves in conflict with environmental groups advocating for specific policies and regulations. Environmentalists, lacking a class analysis, have too often placed workers interests in the same camp as company interests.
Often the conflict is framed around economic growth. Unions support economic growth and see it tied to full employment and strong unions, while environmentalists support a world with less economic growth and impact on wild places, communities and the climate.
The western timber wars of the 1980s and 1990s were particularly tense times. When environmentalists pressured the government to protect wildlife and wilderness in the Pacific Northwest, logging companies Louisiana Pacific, Georgia Pacific, and MAXXAM in northern California, and Boise Cascade and Weyerhauser in Oregon and Washington responded with a variety of tactics to divide timber workers from the “environmental threat” and provoke violence.
Early on, logging corporations used paid company time to “educate” loggers on how to resist government polices regulating forest destruction. One company asked workers, their families, and local businesses to fly yellow ribbons to show solidarity with management against the environmentalist "threat." It became dangerous not to fly ribbons in timber-dependent small towns.
When Earth First! escalated forest defense with direct action campaigns to protect Old Growth forest. Judy Bari, a lifelong member of the Wobblies, became a lead organizer for Earth First! in Redwood Summer in 1990. Bari worked to connect labor to environmental issues. She called for sustainable logging to protect both logger employment and the forests. She pushed Earth First! on finding common ground with loggers and form a united front against companies bent on exploiting workers and destroying the planet.
In May, 1990, Bari and her partner were bombed when starting their car in a parking lot in Oakland while organizing Redwood Summer. Both survived, but campaign momentum was stunted.
In the mid-1990s, when Earth First! descended upon Idaho to fight the Cove-Mallard timber sale, timber industry front groups created a culture of hostility against forest defenders. The Idaho state legislature passed anti-Earth First! laws to stop forest defense with felony charges. Loggers also responded with violent attacks against Earth First!ers.
Not all labor-environmentalist interactions have been bad. In fact, many times environmentalists and labor had banded together to defend the rights of workers and protect the planet from Corporate America. In 1970, the first Earth Day began with critical support from the United Autoworkers (UAW). UAW donated the initial $2,000, provided printed materials, had UAW chapters organize events and eventually endorsed the Clean Air Act, in contrast to other big unions.
On the first Earth Day, UAW President Walter Reuther said:
The labor movement is about that problem we face tomorrow morning. Damn right! But to make that the sole purpose of the labor movement is to miss the main target. I mean, what good is a dollar an hour more in wages if your neighborhood is burning down? What good is another week’s vacation if the lake you used to go to is polluted and you can’t swim in it and the kids can’t play in it? What good is another hundred dollars in pension if the world goes up in atomic smoke?
In Seattle at the World Trade Organization protests in 1999, also known as the “Battle in Seattle,” a new era of labor-environmental cooperation was heralded as "Teamsters and Turtles" marched together against corporate globalization. At the Free Trade Area of the Americas protests in Miami in 2003, John Sweeney toured the convergence space organized by anarchists and environmentalists and proclaimed support and solidarity. The next day when, Miami police violently attached the march, labor, environmentalists, human rights advocates, students and many others were together facing down the corporate police state.
Earlier this year, when more than 7,000 steelworkers across the country walked off the job at 15 oil refineries run by Shell, Chevron, Exxon and other oil companies, another wave of labor-green cooperation swept both movements. During the six week strike action, environmental and climate activists joined steelworkers on the picket lines and groups like the Louisiana Bucket Brigade, Communities for a Better Environment and the Sierra Club voiced support for the striking workers.
In an era of conservative and corporate led attacks on labor and environmental regulations, collective bargaining and frontline communities, bolstering ties between unions and greens is not only powerful, it’s necessary.
As founder and director of the Labor Network for Sustainability, Joe Uehlein, said:
When it comes to the environment, organized labor has two hearts beating within a single breast. On the one hand, the millions of union members are people and citizens like everybody else, threatened by air pollution and water pollution and the devastating consequences of climate change. On the other hand, unions are responsible for protecting the jobs of their members, and efforts to protect the environment sometimes may threaten workers’ jobs.
Scott Parkin is a climate organizer with Rainforest Action Network and Rising Tide North America. You can follow him on Twtter at @sparki1969.