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Commonwealth Bank has been awarded FAIL grades in all four categories of a study into international banks’ fossil fuel lending policies. On top of this, the bank has loaned $6 billion to the dirty coal, oil and gas sectors since supposedly committing to help limit global warming to less than two degrees, four times more than they’ve loaned to renewables.
The bank had an opportunity to redefine its approach to climate change with the release of a new Climate Policy Position Statement in August 2017. But the do-nothing policy failed to place any tangible constraints on lending to fossil fuels, leaving the door wide open for Commonwealth Bank to continue lending to projects that expand the scale of the industry.
Take action: tell Commbank 2 degrees means no new fossil fuels
Commbank’s global fossil fuel lending since 2°C commitment
Has Commbank fulfilled its commitments on two degrees?
In late 2015, Commonwealth Bank publicly committed to taking action to support the international aim of limiting global warming to less than 2°C above pre-industrial levels. But as the scorecard shows, the bank’s recent activity has been completely inconsistent with that commitment.
A two degree warming limit gives us a very strict carbon budget to work within, meaning 80% of known fossil fuel reserves must stay underground if we are to have even a 75% chance of not exceeding the limit.
What does this mean for Commbank? Well the obvious place to start would be a policy excluding new investments that expand the fossil fuel industry. Beyond this, the bank must commit to to actively managing down its exposure to fossil fuels, and become coal-free in five years.
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How is Commonwealth Bank expanding fossil fuels?
Despite its two degree commitment, Commbank continues to loan to companies and projects that are expanding the fossil fuel industry.
One of the most shocking examples of Commbank’s disregard for their two degree commitment came in November 2015, when the bank loaned $49 million to a new deepwater oil drilling project. The new Heidelberg field sits 1620m below sea level around 225km off the Louisiana coast.
That makes it a relatively close neighbour to the Horizon deepwater oil project, where an explosion in 2010 caused one of the worst environmental disasters in recent history.
Find out more about the extent and impacts of banks financing fossil fuels, compare the lending positions of different banks and learn more about how to switch to a bank that aligns to your values.