HSBC has ordered an audit of its relations with logging companies after campaigners exposed its links to clients responsible for the destruction of rainforests in Borneo.
The bank has called in accountants PricewaterhouseCoopers and British forest management company Proforest to oversee a review of its activities, following an exposé of its connections to companies involved in clearing swathes of forest for lucrative palm oil plantations.
A campaign by the non-governmental organisation Global Witness, supported by the naturalist and television presenter Bill Oddie, has highlighted how HSBC clients have contributed to deforestation in the Malaysian state of Sarawak where less than 5 per cent of rainforests are untouched by logging or plantations.
Oddie will tomorrow attend the HSBC annual general meeting as a shareholder to question the bank’s board over the environmental damage caused and question whether it is meeting its own Forest Land and Forest Products Policy, which it introduced in 2004. The BBC presenter wrote in The Independent earlier this month of his concerns that palm oil plantations were wiping out biodiversity in Borneo rainforests.
He said he was “horrified to discover that some of the least reputable companies who are at the forefront of ripping up Borneo's forests and turning them into oil palm plantations are supported by Britain's biggest bank, HSBC - a bank whose PR campaigns led me into believing it was environmentally friendly”.
Oddie was thrown out of the HSBC headquarters in London while making a film – “BankWatch” – to highlight the bank’s links to logging. The film has had 170,000 views, with more than 15,000 people signing a petition calling on HSBC to stop support for loggers.
In response, HSBC has announced an audit of its activities. Simon Martin, head of Global Corporate Sustainability at HSBC Holdings, issued a statement saying: “In light of concerns raised by Global Witness, we will a) Engage Proforest, an independent international organisation that advises on sustainable natural resource management, to benchmark our policy against the wider corporate sector, and make recommendations for improvements; b) commission PricewaterhouseCoopers to conduct a compliance review of our implementation of the policy. We will report on the findings in due course.”
Mr Martin said HSBC has already “stopped providing banking services” to 68 clients in Malaysia because their activities did not comply with the bank’s forest policies.
HSBC believes its policy stands up well alongside those of other financial services companies but is anxious to ensure it is being properly implemented.
Global Witness investigations have revealed how HSBC provided loans and services to logging companies with close ties to Sarawak’s Chief Minister Abdul Taib Mahmud, who is currently under investigation by the Malaysian Anti-Corruption Commission. Alex Helan, campaigner for Global Witness, said: “The HSBC review is a positive step but we want to be sure it’s not just a PR exercise. It must usher in new procedures that stop the bank funding any clients destroying tropical forests.”
But Oddie said the bank’s review of its policy was an insufficient response. “It’s hard to get excited about a limited review of an opaque policy sold to the public as a serious commitment to the world’s forests,” he said.
“We want Stuart Gulliver [HSBC’s chief executive] to make an unambiguous commitment that HSBC will never bankroll companies logging or clearing natural tropical forests, and then to put credible measures in place to show its customers and shareholders that it is serious about delivering on that commitment.”