HSBC promises to cut ties with forest-trashing palm oil companies

There’s been a major breakthrough in protecting Indonesia’s forests: HSBC has committed to breaking its links to palm oil companies destroying forests and peatlands. This is a fantastic result for everyone who has been campaigning over the last few weeks, although the hard work doesn’t stop there. The real test now is how those words will be put into practice.

HSBC’s new policy – released today – says they will no longer provide funding to companies involved in any kind of deforestation or peatland clearance, both of which were missing from previous versions. Another big step forward is insisting that all HSBC’s customers must publish their own forest protection policies by the end of June.

This has come about because the pressure on HSBC has been phenomenal. Over 200,000 people around world signed a petition, which was delivered to the head offices in Jakarta and Kuala Lumpur. Tens of thousands wrote emails directly to the CEO, and volunteers campaigned outside high street branches in Australia, France, and the UK. 

It wasn’t just public pressure – CEO Stuart Gulliver was grilled about our campaign in front of world leaders and other company bosses at the World Economic Forum in Davos. Now he said he agrees with everyone who’s joined the campaign that forests need to be protected.

HSBC needs to put these promises into action right now, because recent satellite images suggest that one of its customers is preparing to destroy a massive area of forest in Papua. One of HSBC’s customers – South Korean conglomerate POSCO Daewoo – has a palm oil subsidiary that controls a large area of land in Papua, and has already cleared huge areas of forest. 

Images taken in mid-January show a new network of roads cut into the remaining forest, which were not there in images taken just three weeks earlier. This is a clear sign that the company is preparing to clear everything between the roads and it’s a huge area – just under 4,000 hectares, which is about the same size as Luton or Cambridge. 

HSBC provides services to other parts of POSCO Daewoo, not directly to the palm oil company, but if it’s serious about stopping deforestation, it needs to put pressure on the parent company straight away and use its influence to get the bulldozers called off.

This will be the first of many tests for HSBC, and the real victory will come when it can show it’s doing everything it can to end deforestation. And if other global banks also follow HSBC’s lead, the cash flow for palm oil companies that continue to tear down forests will finally start to dry up.

Annisa Rahmawati, Senior Forest Campaigner, Greenpeace Southeast Asia