Financial Services - ‘Bankrolling Extinction’? According to portfolio.earth our Of the ten banks abusive relationship with the environment contributes to an USD with the most $8 trillion hole in the global economy. significant It may also be directly responsible for rising unemployment and social exposure to inequality. At the same time, recent analysis suggests that Covid-19 has biodiversity risks, set the global sustainability agenda the top players are back 25 years in just 25 weeks. The latter makes the need to act more headquartered in urgent than ever. the USA, Japan and Whether you look at the 2021 Europe. Several Corporate Knights study of the world’s 100 most sustainable Chinese banks corporations or portfolio.earth’s Bankrolling Extinction report, the appear further financial sector remains at the back down on the list. of the pack when it comes to being accountable for sustainability. Another critical fact to note is what Indeed, in 2019 the world’s largest kinds of investments these banks banks invested more than USD $2.6 have made that contribute to trillion in sectors that governments biodiversity destruction. For example, and scientists agreed were primary 32% of all loans and underwriting drivers of biodiversity loss. That’s were associated with infrastructure, the equivalent of the annual GDP of 25% with metal and mineral mining, Brazil, or Canada, or Korea invested and a further 20% with fossil in activities related to fossil fuel fuels. And despite agriculture and extraction, deforestation, overfishing, fisheries constituting only 10% of all and ecosystem destruction. investments, the food production sector is considered to have a None of these banks had put proportionally higher negative impact any systems in place to monitor on global biodiversity. the specific impact of their loans on biodiversity. Governments To slow the emergence of new risks, even protected them from any financial institutions must work consequences. harder to minimize - even stop - their long-term funding of depleting Now governments are looking to projects. Admittedly this is not such hold banks and insurers liable for an easy request when 80% of the the damage they indirectly cause. world’s energy still comes from fossil Global investors - both retail and fuels. institutional - are also becoming more vocal about where their money goes. 8