What is this film about?
This film takes a light-hearted look at a very serious issue. The UK’s biggest bank has so far made around £100 million by providing loans and services to some of the most destructive logging companies in the world, often in violation of its own policies.
We have created a public petition to HSBC CEO Stuart Gulliver calling for the bank to stop profiting from the disappearing rainforests of Borneo. Please make your voice heard in the run-up to HSBC’s Annual General Meeting on 24th May.
What has HSBC done wrong?
HSBC trades heavily on the image of a responsible bank conducting legal and sustainable business, especially with regard to environmental issues. Bankrolling logging and palm oil companies causing widespread environmental destruction and human rights abuses in Sarawak, Malaysia goes against everything it tells its customers and shareholders.
The bank is also providing financial services to companies widely suspected of engaging in bribery and corruption, putting it at serious risk of breaking international money laundering laws (again).
This isn’t just wrong – it’s risky business. Customers, shareholders and the general public need to know what’s happening.
But hasn’t HSBC got policies in place to prevent this sort of thing?
Yes, it has. Yet they are not transparent and are riddled with loopholes and ambiguities. HSBC announced its flagship environment policy in 2004 requiring its clients in the forest sector to operate legally, not clear primary forests, and to have 70 per cent of operations certified as sustainable to Forest Stewardship Council (FSC) standards by 2009.
In relation to peat forests, its policy requires a ‘cautious approach’, due to the huge stores of carbon locked away in peat forests, which if disturbed, release harmful greenhouse gasses.
The bank also commits to best-practice standards in detecting and avoiding the handling of client’s funds where there is a significant risk that money was acquired corruptly.
So how does HSBC’s practice measure up to these policies?
The short answer is very badly.
HSBC’s clients have played the leading role in the destruction of Sarawak’s rainforests. Global Witness found that none of HSBC’s forestry clients in Sarawak hold a single FSC certificate or equivalent. This represents a 100 per cent compliance failure. Some clients also have close links to notoriously corrupt politicians.
Our investigations uncovered multiple instances of HSBC’s clients acting unethically and illegally. This included clearing proposed national parks, destroying world-renowned peat forests, abusing local indigenous communities, and clearing habitat of the critically endangered orang utan.
What impact has this had?
These clients have caused an environmental and social catastrophe. After decades of HSBC-sponsored logging and oil palm development, Sarawak now has less than five per cent of its rainforests left in a pristine condition. Whole mountains have been stripped of timber, lush valleys have been cleared and planted with oil palm, while indigenous communities have been kicked off their lands.
And it doesn’t stop there. Sarawak’s major logging and oil palm companies, all past or present HSBC clients, have expanded to a dozen countries with concessions totalling 18 million hectares – equivalent to twice the landmass of Portugal. This expansion wouldn’t have been possible without the services and kudos provided by banks like HSBC.
How can it be stopped?
As the UK’s biggest bank, HSBC has a responsibility to make sure it doesn’t do business with such companies. It has reasonably good policies on paper, but exploits loopholes and keeps breaking its own rules. HSBC told us six months ago that, “since 2009, HSBC has indeed exited – or is in the process of exiting – any remaining client relationships in this sector where clients have not shown credible steps to meeting our policy criteria”.
This just doesn’t cut it. Global Witness has uncovered numerous examples of the bank continuing to support these companies even after 2009, while making vague open-ended commitments to clean up its act in future.
These clients must be dropped, and dropped now, while there is still some of Borneo’s rainforest left. HSBC’s policies need to be made water tight and the bank must implement and monitor them in its day-to-day business around the world.
- Read the report
- Read the press release
- Sarawak’s forests: myth and reality
- Watch Sarawak corruption film
- About our forest campaign
- About our banks campaign
- Video introduction to Global Witness