(CN) – A consortium of environmental organizations recently released an annual report detailing how many large international banks continue to finance and fund fossil fuel-oriented operations.
Rainforest Action Network, BankTrack, the Sierra Club and Oil Change International’s report, entitled “Banking on Climate Change,” intends to show the degree to which the world’s major financial institutions continue to participate in activities that the organizations blame for exacerbating climate change.
The report provides analysis on the financing operations of 37 international banks relating to four activities the environmentalists characterize as “extreme fossil fuel” operations, including coal mining, coal power, extreme oil (tar sands, Arctic, and ultra-deepwater oil) and liquid natural gas exporting.
The consortium singled out three Japanese mega-banks for their roles in financing a plethora of such operations across the globe, with all three banks — Mizuho, MUFG and SMFG — earning failing grades, according to the report.
Mizuho, in particular, earned an extra measure of censure for being the only one of the three Japanese banks to increase its exposure to fossil fuel-related activities following the Paris Climate Agreement.
“Mizuho’s increasing financing of fossil fuels is contrary to the global goal set out in the Paris Climate Agreement,” Shin Furuno, Japan Divestment Campaigner from 350.org Japan, said in a prepared statement. “Continued financing of projects like the Dakota Access Pipeline will make Mizuho an international target for divestment based on human rights and climate concerns.”
Mizuho contributed more than $2.9 billion to fossil fuel projects around the globe in 2016 alone, according to the report.
Half of those investments were related to either coal mining or coal-fired power plants, which is the dirtiest source of electricity on the planet, causing air pollution that harms nearby communities and increases the amount of emissions let into the air, the report says.
Coal mines in Indonesia that harm local communities are just one example of the type of projects the bank has facilitated, according to the consortium.
“Fossil fuel burning and tropical deforestation are the leading drivers of climate change, and Mizuho is funding both with billions of dollars,” said Toyo Kawakami, Japan Director at Rainforest Action Network, at a press conference at the Bank of Japan Press Club in Tokyo. “Shareholders need to hold Mizuho accountable for its reckless financial practices.”
Mizuho has increased its fossil fuel position by 60 percent since 2014, when the Paris Climate Agreement was first signed, according to the report.
While other Japanese banks, including Mitsubishi UFJ Financial Group (MUFG) and Sumitomo Mitsui Financial Group (SMFG), also earned failing grades, Mizuho has provided approximately $38 billion (USD) in loans to various fossil fuels companies and/or endeavors, the environmentalists say.
“The inadequacy of Mizuho’s social and environmental safeguard policies has the financial group currently involved in major ESG [environmental, social and governance] controversies worldwide,” the report states. “These include the Dakota Access Pipeline in the United States, a project that has been condemned by UN officials due to its abuse of Indigenous rights; palm oil company Indofood, which has been linked to use of child labor in Indonesia; and the Cirebon-coal fired power plant in Indonesia which faces community opposition due to health and livelihood impacts.”
The report also looked at North American banks, handing out failing grades to CBIC and the Bank of Nova Scotia, both based in Canada.
Bank of America and Wells Fargo both received D grades, while Morgan Stanley, JP Morgan Chase and Goldman Sachs all received C grades.
No bank in Europe garnered a failing grade, but Santander received the lowest grade for the region with a D. The report did not give out any A ratings, but European banks ING, BNP Paribas and BPCE/Natixis received solid Bs.