22nd June, London – Tackling the ongoing role of European financial institutions must be a top priority of today’s France hosted summit, if it is to truly make progress in stopping the financing of deforestation, according to Global Witness.
The international summit for a New Global Financing Pact, hosted by French President Emmanuel Macron, runs between the 22nd and 23rd June. The Summit’s ambition is to bring together several agendas including climate, development, and debt, and to propose innovative solutions to address these issues, whilst taking stock “on all the means and ways of increasing financial solidarity with the South”. It is part of a series of other international events that will take place during the year and will push for concrete results on these occasions.
Speaking ahead of the Summit, Giulia Bondi, Senior EU Forests Campaigner at Global Witness, said:
“Reform of the global financial architecture is long overdue. But grand summits should not disguise the need for countries like France and the EU to put the regulations in place to stop the financial sector continuing to fund nature destruction.
“Biodiversity loss has been a blind spot to date among the guardians of the financial system, who have treated our planet like a limitless extractive resource. But our financial and economic stability depends on nature. The global financial system must protect the biodiversity of those countries most impacted by the climate crisis, to ensure resilient and sustainable societies.
“Embedding the Global Biodiversity Framework, signed in Montreal at COP15 last year, into the global financial system will prove to be central in addressing deforestation, the leading driver of biodiversity loss.”
Recent Global Witness investigations have revealed the continued exposure of banks, such as BNP Paribas, to deforestation. In Deforestation Dividends, Global Witness found that BNP Paribas could have generated an estimated €32.9 million income from €5 billion worth of deals with agribusinesses linked to deforestation and associated human rights abuses between 2016 and 2020.
In Cash Cattle and the Gran Chaco published in March 2023, Global Witness uncovered how, between 2020 and 2022, BNP increased its holdings in one of South America’s largest meatpacking companies – Minerva – despite allegations raised in a previous report linking Minerva to deforestation of Paraguay’s Gran Chaco.
In 2022 alone, French financial institutions provided at least EUR 286 million in forest-risk loans and underwriting services, whilst French asset managers also held EUR 966 million worth of forest-risk bonds and shares, according to Global Witness.
“As the EU Deforestation Regulation (EUDR) enters into force at the end of this month, the European Commission must fulfil its commitments to look into the role of the EU financial sector in bankrolling deforestation and develop rules to ensure that no finance is funding harmful activities for the world’s forests and people depending on them.
“Legal commitments to environmental protection must be prioritized, and tangible measures to pressure financial institutions to eliminate its ties with businesses linked to deforestation and human rights abuses must be implemented. France must therefore show leadership on this if it wants to be a credible actor in reforming the financial sector for people and planet.”