Home > Blog > Investors rebuke NAB over fossil fuel funding at AGM, despite government threats

Investors rebuke NAB over fossil fuel funding at AGM, despite government threats

18 December 2020

18 December 2020

As members of the Australian government seek to launch a probe into the legality of banks divesting from fossil fuels, NAB’s annual shareholder meeting saw its investors push for the bank to further limit funding in line with the Paris Agreement.

In addition to a shareholder resolution calling on the bank to align its policies with the climate goals of the Paris Agreement, the bank faced a barrage of questions from shareholders, impacted communities and activists regarding the bank’s ongoing funding for fossil fuels.

Shareholder resolution

NAB’s November 2019 climate policy was little more than greenwash and a recipe for climate catastrophe, as the bank chose to remain open to funding companies and projects expanding the scale of the fossil fuel industry.

Very little has changed since then, with the bank remaining committed to exit thermal coal in 2035, five years later than necessary to hold global warming to 1.5°C. NAB has also failed to move on oil and gas, with no targets to reduce its loan book exposure to the sector, nor any policies materially restricting its finance for the dirty fuels.

As a result, Market Forces moved ahead with a shareholder resolution pushing NAB to align its policies with the climate goals of the Paris Agreement. An address from our banks campaigner Jack Bertolus was read aloud at the AGM, encouraging shareholders to vote in favour:

Take action! Click here to tell NAB to uphold its support for the Paris Climate Agreement

The resolution achieved a 26.3% vote in favour, representing $20.7 billion worth of support from investors.

Investors have clearly signalled that the bank needs to address the shortcomings in its approach to climate change, and made clear what’s expected of NAB’s upcoming oil and gas policy.

The vote doubles the 12.9% support received by a similar resolution coordinated by Market Forces and lodged with NAB last year.

NAB held accountable for community and climate impacts

Origin Energy

In June 2018, NAB was involved in arranging 4, 5 and 7-year loans totalling $3.77 billion to dirty gas and coal company Origin Energy, whose dirty, dangerous and destructive plans to frack the Beetaloo Basin are opposed by many.

In October, a number of Aboriginal Traditional Owners attended Origin’s AGM, including Mudburra man Raymond Dixon, Alawa woman Naomi Wilfred, Southern Aranda woman Vanessa Farrelly, and Widjabul woman Larissa Baldwin, who all voiced their opposition to Origin’s Beetaloo Fracking plans. Concerns and questions included those regarding impacts on sacred water systems, including dewatering and toxic waste water associated with fracking.

Today, Anusha and Charlotte of GetUp! attended the meeting, asking NAB whether it will continue funding Origin Energy despite its proposed Beetaloo fracking project posing huge risks to the climate, and that Traditional Owners have repeatedly refused consent.

Chairman Philip Chronican dodged the question, telling shareholders “I don’t think I can add anything new” and went on to simply reiterate the bank’s existing commitments on climate change. Issues around Traditional Owner consent were ignored and no follow-up engagement or action was forthcoming.


Just last month, NAB loaned US$50 million to dirty gas company Santos, whose highly opposed Narrabri Gas Project should be blocked on climate grounds according to the former chief scientist.

As part of the project’s planning process, scientists and engineers warned the NSW Independent Planning Commission of serious risks to water.

“The area provides recharge for Australia’s most important aquifer system – the Great Artesian Basin and is close to the vitally important Namoi Alluvium. The risks of groundwater and surface contamination and drawdown are real.”

Associate Professor Matthew Currell, School of Engineering, RMIT

Shareholder Scott, a 5th generation grain producer on the Liverpool Plains, told the bank his family will likely be the last generation to do so, as the climate impacts reach an unbearable level.

Scott asked the board when it will show leadership by divesting from companies like Santos which are pursuing destructive projects, including the Narrabri Gas Project, risking water and climate.

Mr. Chronican told shareholders he “shares the concerns” raised by Scott but essentially ignored them. Shareholders rolled their eyes as Chronican responded by citing the bank’s involvement in yet another fancy-sounding climate initiative, this latest one dubbed the ‘Collective Commitment to Climate Action’.

More than five years since the Paris Agreement, NAB’s involvement in countless initiatives has so far seen it fail to take even the most basic and necessary steps to align its financing activities with the Agreement’s goals. Given the vote on today’s climate resolution, it’s clear that shareholders are fed up with flowery words from NAB and expect action.


As a 5th generation farmer from Coonamble NSW, Adam’s farm and community are entirely dependent on the Great Artesian Basin. Yet in May 2018, NAB agreed to extend $65 million of credit for 5 years to dirty gas pipeline company APA Group, which plans to build a 460 kilometre gas pipeline that would offtake gas from Santos’s Narrabri Gas Project.

Given these projects risk the groundwater of an entire community, Adam asked what actions NAB has taken to understand the impacts.

Mr. Chronican’s answer ignored the question, with the chairman instead telling shareholders he couldn’t speak in detail about the companies NAB funded, even though this isn’t what Adam asked for or alluded to. Chronican offered no follow-up engagement or support for Adam or his community.

Chronican also told shareholders “we review the impact that all of our sensitive transitions have”. If that’s the case, it’s astonishing that NAB continues to fund the likes of Santos and Whitehaven.


Earlier this year NAB loaned $110 million to Whitehaven Coal, which justifies its expansion plans with coal demand projections consistent with 4°C of global warming. Meanwhile NAB’s major competitor ANZ, which previously loaned to Whitehaven in 2017, dropped out of the lending syndicate.

Last week, Whitehaven pleaded guilty to 19 charges for illegally drilling water bore holes, failing to rehabilitate drill sites and bulldozing land to build unauthorised roads at its Narrabri coal mine.

Landowners and farmers have expressed serious concerns regarding the impacts Whitehaven’s proposed projects would have on local groundwater. This follows a litany of water-related issues connected to the company, including the use of inaccurate groundwater modelling and the outbidding of local farmers for groundwater licences.

Shareholder and Boggabri farmer Dave asked what the bank is doing to alleviate community concerns.

Mr. Chronican’s answer again ignored the question, with the chairman reiterating that he can’t speak in detail about the companies NAB funded, even though this isn’t what Dave asked for or alluded to.

Chronican also repeated that NAB would exit thermal coal mining by 2035, even though this clearly hasn’t prevented the bank from funding Whitehaven Coal and doesn’t address any of the concerns held by Dave and his community.

Funding climate failure

Emeritus Professor Will Steffen, a renowned climate change scientist and researcher at the Australian National University, told NAB there cannot be any expansion of fossil fuel production if we’re to achieve the Paris climate goals. As such, Steffen asked whether NAB will adopt a policy to rule out funding new gas projects.

Mr. Chronican didn’t answer the question and instead answered a seemingly different question, telling Steffen that NAB would publish exposure pathways for oil and gas next year. Shareholders were left confused, as this is completely separate from the issue of whether or not NAB will lend to new gas projects moving forward.

Part of Mr. Chronican’s answer was also that NAB’s oil and gas extraction exposures had undergone “quite a material decrease of almost 30%” since last year. However, this seems disingenuous given that Chronican later told shareholders “these [exposure] numbers move around purely because they’re expressed in different currencies” (see below), indicating there may have been little or no underlying decrease in the bank’s exposure.

Polluting oil and gas

A report published two weeks ago, from leading research organisations and the UN, found that global oil and gas production must decline annually by 4% and 3% respectively between 2020 and 2030 to be consistent with the Paris Agreement’s 1.5 degree pathway.

Given this report and that NAB’s latest figures report the bank’s lending exposure to oil and gas extraction declined 27% from 2019 to 2020, a shareholder asked whether the bank expects its oil and gas exposure to decline moving forward consistent with the Paris Agreement.

Mr. Chronican took credit for the declining exposure, telling the shareholder “I think the question has pretty much answered itself” because the 27% decline in oil and gas extraction exposure “outstripped” the declines required to be consistent with Paris.

However, Chronican then immediately contradicted this statement by telling shareholders “whether it continues to decline at that rate is not clear, sometimes these numbers move around purely because they’re expressed in different currencies”.

Indeed, NAB’s full year reporting attributed the decline to “AUD currency appreciation of USD denominated exposures and lower mark-to-market position of treasury related products”. The bank has failed to clarify what the change in exposure was net of these effects, leaving shareholders confused as to what degree NAB has managed down the exposure.

Policy breach

In December 2017, NAB announced it “will no longer finance new thermal coal mining projects”. Since then, the bank has apparently breached this commitment on multiple occasions by lending to the likes of Coronado Global Resources and New Hope Group, with those funds clearly supporting new and expanded thermal coal mining projects.

NAB has been repeatedly questioned on this point by shareholders, as well as members of the House of Representatives Standing Committee on Economics, yet has failed to clarify how these loans could possibly be considered compatible with its policy.

One shareholder asked who is responsible for the breaches, what disciplinary action will be taken and when NAB intends to withdraw its exposure to the affected borrowers.

Mr. Chronican simply told shareholders “there is no breach that I’m aware of”. The brevity of this answer is stunning given the evidence and seriousness of the allegations.

Climate impacts on agribusiness

In 2019, Commonwealth Bank disclosed an assessment which found its grains, livestock and dairy agriculture portfolios face declines in productivity and profitability of 40-50% out to 2060 as a result of climate-change impacts, unless mitigating steps are taken.

Given that NAB claims it’s “Australia’s largest agribusiness lender”, a shareholder asked what change it anticipates to the rate of default in its agriculture loan book under scenarios of unmitigated climate change.

Despite telling shareholders “this is an issue we’ve spent quite a lot of time on”, astonishingly Chairman Philip Chronican couldn’t provide a figure. He also failed to give any indication of whether NAB has conducted such as assessment, or when it will disclose one. This left shareholders scratching their heads regarding the impacts climate change could have on a significant portion of the bank’s business.

Perhaps just as astonishing was the way NAB proposed to mitigate climate change impacts on the agriculture sector. This included reforestation and replanting but, bewilderingly, didn’t include a commitment that NAB will stop funding expansion of the fossil fuel industry, the primary cause of anthropogenic global warming.

Take action

Take action! Click here to tell NAB to uphold its support for the Paris Climate Agreement