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Banks Unethical says ABC story. BFCSA members have evidence they are indeed a bunch of crooks. Time to Have a Royal Commission Into Australian Banks

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ABC:   Australian banks financing companies accused of land grabs, illegal logging and child labour: Oxfam

Updated 10 minutes ago

Leading Australian banks are financing companies accused of land grabbing, child labour and illegal logging, according to an Oxfam report released today.

The report, Banking on Shaky Ground, identifies four cases in Cambodia, Papua New Guinea, Indonesia and Brazil where Australia's biggest banks have funded - directly or indirectly - companies accused of improperly or illegally acquiring land from local people.

Oxfam's chief executive Helen Szoke said the big four - National Australia Bank (NAB), Commonwealth (CBA), Westpac and ANZ - are not living up to their image as global leaders in sustainable banking.

"There is a gap between what the big four banks say they do and what they actually do," she said.

"We think there is a real problem around due diligence - around them actually focusing on their investment practices and making sure they put their money where their mouth is, in terms of ethical and sustainable investment practices in these agricultural businesses overseas."

 

According to Dr Szoke, Oxfam's research shows that the banks' exposure to companies in the agricultural commodities industry is in excess of $20 billion.

"It's in the banks' best interests to know that when they invest in a company that has an agricultural business that the company is actually producing what it says it's going to produce, that it's actually acquired the land legally and then it looks after the communities that are impacted by that investment," she said.

The chief executive of the Responsible Investment Association of Australasia, Simon O'Connor, said the report raises some serious questions about how the banks manage risk as they continue to expand into Asia and other developing markets.

"This is very much a changing world for them. What we as investors hope is ... there are strict due diligence processes and that they are understanding these risks before diving into these markets," he said.

Westpac linked to company accused of illegal logging: report

The report links Westpac's Papua New Guinea operations to the Malaysian logging giant WTK Group, which has been accused of illegal logging in PNG.

Corporate records reveal that Westpac's PNG subsidiary has had a 19-year relationship with the company.

Oxfam alleges that WTK Realty in PNG has an interest in a number of controversial special agricultural and business leases (SABLs) across the country.

In 2013, a commission of inquiry established to investigate the leases found that the vast majority had been improperly obtained and should be revoked.

Oxfam says WTK Realty is the sole shareholder in Vanimo Forest Products Ltd, which the commission of inquiry "observed to be engaging in selective logging operations" at the 139,909 hectare Bewani Oil Palm Development Project Bewani in West Sepik province.

If Westpac has taken a position that it's going to support retaining the rainforest, then obviously if they are funding a company that is cutting down trees and causing damage to the environment generally then they should rethink providing funding to companies like that.

Commissioner John Numapo

 

The commission found that landowners had not given informed consent for the development and recommended the lease be revoked.

The chief commissioner of the land scandal inquiry, John Numapo, said the SABL scheme was being used by Malaysian logging companies to access parts of the country's pristine forest that would otherwise be off-limits and that the operations were coming at the cost of local landowners.

"We found the majority of SABLs were being used basically as a guise to go into full-scale logging operation which it's not intended for," he said.

"There have been a lot of abuses as we discovered through our inquiries. We found that basically the whole process had been hijacked."

Commissioner Numapo urged Westpac to reconsider its relationship with WTK if their link to SABLs was confirmed.

"If Westpac has taken a position that it's going to support retaining the rainforest, then obviously if they are funding a company that is cutting down trees and causing damage to the environment generally then they should rethink providing funding to companies like that," he said.

Westpac declined to confirm or deny their link to WTK, but the bank's head of sustainability, Siobhan Toohil, said it had exited funding arrangements in the past where clients had not lived up to the bank's environmental and social standards.

"In circumstances where we do not believe that customers are adhering to appropriate standards and do not believe they are prepared to address this responsibly, we will continue to exit those relationships," she said.

WTK's lawyer in Port Moresby rejected the accusations that the company is linked to any of the agricultural leases.

"If WTK Realty was involved in SABLs it would have been summonsed to give evidence in the commission of inquiry," said lawyer Robert Bradshaw.

 

Woman run over by harvester at ANZ-linked sugar development

 

ANZ's links to a controversial sugar development in Cambodia also come under the spotlight of Oxfam's report.

In 2011, the bank lent money to a sugar company owned by influential businessman and ruling party senator Ly Yong Phat.

Senator Phat's company, Phnom Penh Sugar, was midway through the construction of what has since become Cambodia's largest sugar operation.

While the deal has brought jobs to one of the poorest parts of Cambodia, it has also come at a cost to the local population.

An investigation by the Phnom Penh Post in 2013 revealed that children as young as seven were regularly employed in the cane fields that supply the company.

To make way for Phnom Penh Sugar's cane, 500 families were forcibly removed from their land under a Cambodian law, which allows the government to lease land to private companies for 99 years.

Local activist Eang Vuthy told the ABC that despite Cambodia's land law requiring fair compensation for anyone dispossessed of land, many of the villagers who were relocated were poorly compensated.

"We see thousands of families seriously impacted by this business," he said.

"If you talk to the people they will say 'We don't have any options - we work every day just to feed our children. If we stop for one day we will not have food to eat'."

Tha Seng Hak's family had to walk off their 25 hectares of land in 2010 to make way for the Phnom Penh Sugar's crops.

 

Ms Hak, 19, said her mother bought the land in 1999 to supplement the family's income but received no compensation from the government when they were moved.

She said her mother had no choice but to work in the sugar fields for the company to make ends meet.

"We didn't have money to buy food; that's why we can't be unemployed," she said.

"We decided to work in the sugar plantations for them. When we started working here we only registered our names and then went to work. No safety training was provided. They didn't tell us anything."

The ABC spoke to the general manager of Phnom Penh Sugar, who confirmed the company was yet to implement a work health and safety policy to protect its workers.

Tragically, just six weeks ago Ms Hak's mother was killed when she was run over by a harvester while sleeping in the field during a work stoppage.

Ms Hak witnessed the gruesome aftermath and her memories from that day continue to haunt her.

"I couldn't sleep for two nights. Whenever I closed my eyes I saw all those images," she said.

"I am the only daughter who saw it, and I saw all the pieces of her body."

ANZ, which commissioned a 2010 audit of the project prior to agreeing to help finance it, said it had been in talks in Cambodia and Australia to hear the concerns of the local people and had supported Phnom Penh Sugar to address the issues raised by villagers.

At the time a spokesperson told the ABC that "ANZ is continuing to actively and closely review the way Phnom Penh Sugar is addressing its social and environmental obligations".

Today an ANZ spokesman said the company took its social and environmental obligations seriously, and said the new Oxfam report was not up to date.

"Almost half the companies raised with us are not customers, including one exited several years ago for social and environmental reasons," he said.

"Of those that are customers, the claims - some of which are almost a decade old - have in several cases been previously publicly examined and resolved by our customers. However, we asked our customers for updates and we are satisfied with their responses."

NAB linked to palm oil; CBA linked to sugar company

Oxfam's research also links NAB to the Singaporean palm oil giant Wilmar and CBA to a company called Bunge, whose sugar operations in Brazil are under investigation for alleged links to land grabs.

Since 2010, NAB has loaned more than $200 million to Wilmar and has continued to do so even after Newsweek named it the company with the worst environmental policies in 2012.

In December 2013, Wilmar announced a sweeping overhaul of its environmental policies and signed a "no deforestation" pledge.

In statements to the ABC, NAB said that it was unable to provide specific information about its clients, but it "supports actions that promote better environmental and social outcomes for businesses and the communities in which they operate".

CBA has invested $14 million of its clients' money in Bunge, one of the world's largest agricultural commodity companies, which has been accused of sourcing sugar cane from land stolen from the indigenous Guarani people of Jata Yvary in Brazil.

The bank denied having a propriety interest in Bunge and said that its interest was held in funds managed by the bank.

In a statement, the bank said it "will engage with relevant parties on the issues raised in accordance with our investment policies on responsible investment and stewardship".

Oxfam is calling on the big four banks to adopt a zero-tolerance approach to land grabs and to be more transparent about the companies and projects they invest in.

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Comments

  • doyla66
    doyla66 Monday, 28 April 2014

    Of course they'd have their dirty grubby money hungry hands into illegal and unethical operations
    as per usual. Any way of making A LEGAL OR ILLEGAL buck is ok by the big 4.
    The poor land owners are the easiest targets to attack, no fighting funds, no worries, and over there
    their lives would be threatened...DAMN THE ROBBERS!

  • doyla66
    doyla66 Monday, 28 April 2014

    If banks are involved in illegal activity in Australia it comes as no surprise that they're involved in unethical conduct as well.
    Good work Oxfam for exposing this conduct to public comment.
    In the end no one will want anything to do with Australian Banks .... no one except other criminals.
    Let this be a warning to Banks to clean up their act. Even their dirty linen and skeletons in the closet will all be revealed eventually. The sooner they clean up the less there will be to embarrass their CEOs at Inquiries!

  • doyla66
    doyla66 Wednesday, 30 April 2014

    It's pure evil to the point I feel ashamed to be an Australian for nobody in authority are prepared to put a stop to what they have foolishly allowed to happen and what they all know they allowed to happen with no regard at all for what they have done and are still doing to Australian citizens and our country. Our banks are as evil as the rest of them. We were all so very cleverly conned into believing otherwise yet all achieved by deceit and false words has seen far worse damage to the economy and the suffering of the people than dared imagine and as truths are starting to be revealed the worse it gets for they are now all operating in panic mode and every single day more and more people are able to see right through them. Money is the root of all evil, always has been, always will be and that alas is the golden carrot they are all mesmerised by. All the fat salaries, obscene bonuses and bribes will not protect any of them in the end and I for one would not want to be in any of their shoes for all the tea in china. I honestly feel I am living in a time warp - modern day version of the 1940's and what happened a few decades before combined in my view for the digger you deep the more you learn and the more atrocities are revealed. May they all disappear into a huge sink hole of their own funding!

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