‘Not ready’: investors chop down deforestation action
Derek Rose |
A major bank has struck a conciliatory tone with shareholder activists after they failed to get the business-focused group to commit to more action on deforestation.
Two resolutions put up by the Australian Conservation Foundation overwhelmingly failed at National Australia Bank’s annual general meeting on Friday, with more than 85 per cent of votes against.
The board had recommended that shareholders reject them.
NAB chair Philip Chronican told the conservationists who spoke in favour of the resolutions that, while he risked getting into a “heated agreement”, the bank understood the need for sustainable land use and natural capital preservation.
The bank was at the early stages of understanding how it could codify and standardise its reporting around deforestation, “so we’re not ready for these resolutions as they’re written”, he said.
But that wouldn’t stop NAB from understanding the way in which land use was evolving, he added.
The bank had been increasing its use of vegetation and habitat coverage tools, including the purchase of vegetation coverage databases to inform its climate risk assessments, Mr Chronican said.
It was also engaging with stakeholders to build an understanding of the complex issue of deforestation.
Jolene George, the head of corporate advocacy at the Australian Conservation Foundation, acknowledged NAB had been an early leader among the big four banks when it came to recognising the risks posed by biodiversity decline and ecosystem degradation.
“Nature, our natural capital, underpins all economic activity,” she said.
“Research from the World Economic Forum shows all (economic output) is in some way dependent on nature.”
Ms George said the resolutions put forward – in conjunction with ethical investing platform SIX, Australian Ethical and Melior Investment Management – required NAB to say how it was managing the risks around deforestation and disclose its strategy to eliminate deforestation financing.
“Global momentum is quickly shifting towards markets, consumers and governments rejecting commodities linked to deforestation,” she said.
Ms George said the support the resolutions received showed investors were increasingly recognising the economy’s dependence on nature.
“A bank cannot afford to ignore the views of 14 per cent of its owners,” she said after the meeting in Sydney ended, referring to the backing the first of the two resolutions received.
Deforestation was also a major topic of discussion at Westpac’s annual general meeting on Thursday, after CEO Anthony Miller abandoned a commitment made by predecessor Peter King in 2023 to enact a no-deforestation lending policy by the end of 2025.
Mr Miller said Westpac’s farming customers were already “exceptional” managers of their farming land and had made it clear to the bank the policy “was of no value”.
Another resolution put to NAB shareholders related to climate change was withdrawn ahead of the meeting, after its activist backers said they were satisfied the bank was making progress on the issue.
Kyle Robertson, head of research at environment advocacy group Market Forces, said while NAB had made progress on climate change, it was still providing financing to APA Group, which is developing two gas pipelines from the NT’s Beetaloo Basin to Darwin and Australia’s east coast.
The company was opening up “one of Australia’s biggest and most polluting fracking developments”, he said.
NAB shares were up 1.8 per cent at $42.12 on Friday afternoon.
AAP
