Brisbane, 7 November 2018
At today’s Commonwealth Bank annual general meeting (AGM), chairwoman Catherine Livingstone told shareholders she believed it was unlikely the bank would finance any new ‘greenfield’ fossil fuels proposals. Such projects include coal mines, oil and gas fields, and fossil fuel infrastructure built on completely new sites.
“It’s unlikely, I would say, that new greenfield fossil fuels proposals would go through and be accepted when we apply our ESG or environment social and governance criteria, which we do to every lending proposal,” said Livingstone.
Her statement follows CommBank’s whopping US$234.8 million loan in May for a massive new liquefied natural gas (LNG) facility in Texas. Over its lifetime this LNG infrastructure would enable the release of 811 million tonnes (Mt) of CO2-e, equivalent to 1.5 times Australia’s emissions last year.
This lending activity appears to contradict Livingstone’s opinion.
It’s also yet another statement from CommBank that’s not reflected in official policy. At last year’s AGM, Livingstone said “our coal funding is comparatively small and has been trending down for some time. We expect that trend to continue over time as we help finance the transition to a low carbon economy.”
Whilst this was a welcome announcement, its lack of appearance in policy is a problem. When asked today by a shareholder why CommBank still lacked a coal policy, Livingstone reiterated “we will be reducing our coal exposure over time and that is our commitment to the transition policy that we have.”
If this commitment is anything like CommBank’s pledge to help keep global warming well below 2°C, it may well be flouted.
The bank, which has loaned at least $7.2 billion to the fossil fuel industry since publicly championing the Paris 2°C goal in late 2015, remains the only one of Australia’s ‘big four’ without any policy on limiting investment or exposure to the coal sector.
Take action: tell CommBank 2°C means no new fossil fuels
Why CommBank refuses to put pen to paper on this issue is puzzling, given that its reported lending to all fossil fuels has fallen significantly in recent years and it hasn’t loaned to new coal projects since publicly supporting the Paris Agreement.
So, can we expect Livingstone’s latest statement to make its way into policy in the form of a restriction to support for new fossil fuel projects? If the bank gets serious about climate change, yes. Unfortunately, recent history suggests this is unlikely to be anytime soon.
The bank also made clear today that it views gas as “part of the [energy] transition.”
This is despite a recent study from Oxford University researchers which found that not only can no more CO2-emitting power plants be built globally, but that “~20% of global capacity would need to be stranded to meet the climate goals set out in the Paris Agreement.”
CommBank’s statements also follow a Carbon Tracker report highlighting the LNG industry as particularly vulnerable to stranded asset risk.