This post is by Ben Collins of RAN and Yann Louvel of BankTrack.
The campaign to stop bank financing of mountaintop removal coal mining is gaining momentum.
For years, RAN and other organizations in the global BankTrack network have urged U.S. and European banks to stop financing the devastation caused by mountaintop removal (MTR) coal mining. BankTrack members have worked closely with advocates from Appalachia — the region hardest hit by MTR — including Paul Corbit Brown and Elise Keaton from Keeper of the Mountains, and Bob Kincaid from Coal River Mountain Watch. Together, they’ve travelled around the U.S. and Europe to speak directly to CEOs and boards of banks at their annual shareholder meetings and urge them to stop bankrolling mountaintop removal coal mining.
This week, we have an opportunity to push France’s biggest bank, Crédit Agricole, to stop profiting from MTR once and for all. At today’s annual shareholder meeting, Paul Corbit Brown and staff from Friends of the Earth France urged the bank’s CEO, Jean-Paul Chifflet, to follow the lead of other banks and stop funding the biggest and most destructive MTR companies.
Public pressure to stop funding MTR started showing results a few years ago. U.S. banks were the first to react in 2008, adopting a mix of enhanced due diligence procedures and financing thresholds for companies that engage in mountaintop removal. But real change started to happen last year, when Wells Fargo in the U.S., and Crédit Agricole and BNP Paribas in France, adopted new policies on MTR. These covered both direct project financing of MTR projects — which is pretty rare — and, more importantly, general corporate financing of coal mining companies active in MTR.
The implications of these new policies are potentially huge: the biggest and most harmful producers of MTR coal, such as Alpha Natural Resources and Arch Coal, raise their funding from general corporate loans from banks or from bonds or shares issued to investors. And these are precisely the transactions that should be excluded by these new policies, which bar financing for companies that are “significant” producers of MTR coal.
But we’ve learned that different banks define "significant" in wildly different ways. BNP Paribas blacklists the main companies active in MTR production, including Alpha and Arch. But Crédit Agricole — while its policy looks similar to BNP’s on paper — excludes only those coal mining companies that produce more than 20% of their coal from MTR. In practice, they aren’t prohibited from doing business with any MTR companies at all!
Crédit Agricole has financed several loan and bond deals for Alpha and Arch — the worst of the worst MTR companies — while BNP Paribas hasn’t done any deals with these two companies since last year. Ironically for Crédit Agricole, financing MTR has not only been bad for the environment and human rights — it’s also been a bad investment. The bank suffered significant financial losses from loans it made to recently-bankrupt MTR miner Trinity Coal.
In contrast to Crédit Agricole, other U.S. and European banks have taken concrete steps away from MTR financing this spring. Last month, JPMorgan Chase published an update of its environmental and social policy framework, stating that they expected to continue defunding companies engaged in mountaintop mining. And in the U.K., Royal Bank of Scotland (RBS) published a mining policy update prohibiting deals with the main MTR producers. Unlike Crédit Agricole’s new policy, these policy changes at JPMorgan Chase and RBS have teeth: both banks will stop financing top MTR producers, including Alpha and Arch.
Today, our allies went straight to Crédit Agricole’s annual shareholder meeting to tell the bank’s CEO and board close its massive MTR loophole, and stop funding Alpha and Arch.
Yann Louvel, Climate and Energy Campaign Coordinator, BankTrack
Ben Collins, Research and Policy Campaigner, Rainforest Action Network
The Obama-GOP plan cuts about $917 billion in government spending over the next decade. Nearly $570 billion of that would come from what's called "nondefense discretionary spending." That's budget-speak for the pile of money the government invests in the nation's safety and future—education and job training, air traffic control, health research, border security, physical infrastructure, environmental and consumer protection, child care, nutrition, law enforcement, and more.Our country's environmental laws and the agencies tasked with enforcing them have certainly taken a huge hit, which is especially troubling because the record-breaking heatwave we’re currently witnessing is only the latest projected impact of our warming climate to become all-too-real. We need strong climate policies and a clean energy revolution right now in order to avert runaway climate change. Instead, this deal jeopardizes even the most basic environmental protections, like the right to clean water and air. The full implication of the Obama-GOP debt deal won't be clear for some time, as the cuts it calls for are just the first round. The deal also mandates the creation of a 12-member “SuperCongress” committee that will determine where to make cuts totaling another $1.5 trillion. But given how things stand right now, environmental protections in this country have taken a severe blow.
- Guts Clean Water Act and Clean Air Act enforcement
- Less money for states to enforce environmental laws, too
- Lets Big Oil keep taxpayer-funded handouts
- Dries up investments in renewable energy
- Further diminishes chance of establishing a carbon tax
In 2000, the palm oil company Karya Mufakat Lestari (KML) came to our village, Sei Ilai, in the Sanggau District [in northern Borneo near the border with Sarawak/Malaysia], promising us a better life. They promised to bring our kids a better education, new houses, a new church, and new streets. So we made a smallholder scheme agreement with KML in which we gave our ancestral lands to the company to develop oil palm plantations and we would manage a portion of them. In our district the people agreed to give KML 7,000 hectares of land, and that for every 10 hectares of land, 4 hectares would be cared for by the people and 6 by the company. But after we gave our land to KML, the company collapsed. Our village leader, Pak Suez, saw that KML was neglecting their palm plantations on his ancestral land. Seeing that the palm plantations were dying, Pak Suez took the initiative of caring for the plantations because he felt it was his own land so he replanted 1,000 oil palm plants on his own. He spent 500 million Rupiah. Another palm oil company, BKP, bought out KML but this was not communicated to any of the Indigenous Peoples in the area, not by the company nor by the Bupati [district head]. As far as we knew, the company changed their name to BKP. When the new company, BKP, took over, the communities didn’t understand that KML and BKP had different smallholder scheme rules. For example, BKP didn’t honor the 4/6 hectare people/company ownership ratio. BKP never sat down with the community to make a new agreement and yet they have put Pak Suez in jail because they claim he has taken over 40 hectares of land without permission. Pak Suez feels cheated by the company since he spent 500 million Rupiah replanting his palm plantations and the company only wants to pay him 175 million Rupiah. Pak Suez would be cheated out of what BKP owes him if he had silently settled.[caption id="" align="alignleft" width="300" caption="Pak Suez has now been in jail for almost two weeks. Photo: Hendi/Walhi Kalbar"][/caption] On May 27, 2010 the Bupati called a meeting between BKP and the community, but there was no resolution. On August 26 there was another meeting and BKP tried to reach a new agreement with the community but, fearing more lies, the community did not budge. Pak Suez has now been in jail for almost two weeks. Pak Miguel Deban, Pak Sariano, Pak Suez’s 16 year-old son, and the other community members I met yesterday traveled 7 hours from their rural village to visit Pak Suez in the Pontianak jail and to meet with his lawyer. According to the community members, the company’s strategy is to use intimidation to make the families in the Sanggau District fear them. Hundreds of families are now blockading their lands from palm oil companies, and Pak Miguel says that the company will only free Pak Suez from jail if the families stop blocking their land. It turns out that this smallholder case of social conflict in the Sanggau District is a template for what’s going on across Borneo between palm oil smallholders or non-palm oil traditional land holders and palm oil companies. (In particular it sounds a lot like what happened to the community of Semunying Jaya.) The process of establishing large-scale oil palm plantations is irreversible: Indigenous Peoples contribute their lands and labor to oil palm schemes but lose sovereignty over those lands and natural resources that are central to their identity as Indigenous Peoples.