This week, HSBC became the second international bank in as many months to take a step away from financing in the Tar Sands.
The bank hinted in press reports last year that it was reviewing its tar sands business. Now the London-based bank has come through. In a post to its website, the bank quietly revised its “Energy Sector Policy” to clarify that:
HSBC has policy restrictions where customers are involved in the principal processes of mining, extraction and upgrading. We undertake a balanced analysis of positive and negative impacts to understand whether customers operate in accordance with good practice, focusing on factual data and trends where available. Specifically, we analyse: GHG intensity; water usage; land and tailings pond reclamation; the grievance process in place for local communities; and the extent to which a customer discloses standards and performance.
For the bank we ranked 13th among tar sands financiers last year, it ain’t perfect. The new policy lacks any timelines, targets, or definitions. And the devil’s always in those details.
You have to wonder, for instance, about that “GHG intensity” commitment. Last year the banking giant underwrote $625 million in bonds for TransCanada. TransCanada is now facing a slew of lawsuits and regulatory hurdles over it’s proposed “Keystone XL” tar sands pipeline to Texas. In a request to delay approval of the pipeline, the EPA issued concerns that the product it would carry is 82% more GHG-intensive than conventional crude.
The “local communities” commitment also raises questions. HSBC raised $100 million in bonds for Enbridge last year. Enbridge is the company working with Chinese oil companies to push the “Northern Gateway” tar sands pipeline through the heart of the Great Bear Rainforest to a tanker port in Northern British Columbia. More than 60 First Nation communities have declared their opposition to the project, calling it a violation of their rights and the integrity of their traditional territories.
Pure greenwash? Only time will tell. And HSBC’s dealings (or not) with Enbridge and TransCanada will be early indicators. Meantime, at the very least, the new HSBC policy is a welcome sign that banks are beginning to recognize that tar sands is a risky business.
For those keeping score, international banks that have developed sector-specific policies that cover tar sands are (in chronological order):