Concerned NAB shareholders will today file Australia's first bank shareholder resolution on deforestation.
The resolution calls on the bank, which is Australia's biggest agribusiness lender, to:
- Disclose how much it lends to customers involved in deforestation, and
- Set a strategy to stop financing deforestation, in line with global standards.
The shareholder resolution, which will go to NAB's annual meeting on 12 December, is facilitated by the Australian Conservation Foundation and co-filed by SIX Invest, Australian Ethical, Melior Investment Management and more than 100 shareholders.
"Our investigations show NAB has the highest exposure to deforestation among Australian banks," said ACF's acting CEO Paul Sinclair.
"More than half of Australia's agricultural land is already degraded, which comes at a $260bn annual cost to the economy, yet Australia remains a global deforestation front, with economy-wide risks banks can no longer ignore.
"ACF's analysis of 100 land titles of properties where deforestation has occurred shows NAB financed twice as many of these properties as any other bank.
"Two years after ACF's Banking on nature destruction report, Westpac is the only Australian bank that has made a no-deforestation commitment.
"Australia is one of the most biodiverse countries on Earth, yet we are also a global deforestation hotspot, alongside the Amazon and Borneo.
"Recent investigations by ACF show destruction of habitat for threatened species, including koalas, pink cockatoos and greater gliders, continues apace in Australia.
"Banks that finance deforestation not only destroy habitat and drive species towards extinction, they also expose themselves, their shareholders and the broader economy to escalating environmental and financial risks.
"By taking bold, science-aligned action now, Australian banks can help halt deforestation, protect biodiversity and lead the transition to a more resilient economy.
"Banks need to adopt clear policies to eliminate deforestation from their lending portfolios and invest in internal capability to identify and monitor nature-related risk."
Amanda Richman, Ethical Stewardship Lead, Australian Ethical, said:
"As investors committed to using our capital to drive positive change, we've been engaging with NAB to seek a commitment to stopping the financing of deforestation.
"It's not good business for any bank to be funding clients who rely on deforestation to make a profit - these same clients face heightened financial risk associated with the degradation of soil quality, reduced long term agricultural capacity and potentially reduced market access.
"As shareholders we want to see NAB reduce its exposure to these unsustainable practices.
"If NAB takes decisive action, it will reduce the banks' exposure to risk and support the protection of the broader economy from escalating environmental and financial risks."
Phoebe Rountree, campaign manager at SIX Invest said:
"Australia holds the unfortunate title of being a global deforestation hotspot. Many iconic Australian species are on the brink of extinction. And behind every business that's bulldozing the bush is a bank.
"Shareholders are calling on NAB to step up and stop enabling deforestation.
"Shareholders deserve to know their company is doing all it can to manage financed deforestation and help protect Australia's unique wildlife, forests and bush. This resolution marks an escalation in shareholders speaking up for nature.
"This resolution is an opportunity for NAB to lead and act. Shareholders will be watching closely to see how NAB responds."
Legal opinion by Sebastian Hartford-Davis and Zoe Bush in 2023 concluded failure on the part of company directors to identify, manage and disclose material nature-related risks may lead to them being found in breach of their duties of care and diligence.
