11 December 2015
Westpac has today made a commitment to operate in line with an economy that limits global warming to below two degrees! CEO Brian Hartzer said to hundreds of shareholders in Sydney:
Take action! Click here to tell Westpac you’ll be holding them accountable for their commitment on climate change!
We know you believe us, but here is CEO Hartzer making the announcement:
What keeping global warming to two degrees means for the banks
Westpac’s language goes far further than the other major banks on the two degree global warming limit. From this point on, every lending or other investment decision the bank makes will need to sit comfortably with the commitment made today. And that means major change in how it does business on energy.
The world is currently on track to use up its remaining carbon budget to avoid passing two degrees in barely twenty years. A recent Climate Action Tracker report shows that even with no new construction, in 2030, global coal-fired power generation emissions would still be more than 150% higher than what is consistent with holding warming below 2°C. This means that at a minimum, Westpac’s days of financing new fossil fuel projects are over. There is simply no more room in the carbon budget for additional fossil fuel combustion and any bank acting to help keep global warming below two degrees will have to avoid these projects.
In Australia, the clear implication is for the Galilee Basin mega coal mines. To date, NAB is the only bank to publicly rule out any of these projects, but by committing themselves to action to help keep global warming to less than two degrees, there is no way Westpac could maintain this commitment while financing projects that open up one of the largest untapped coal reserves. Westpac would also be unable to finance the dozens of proposed coal-fired power stations or the coal and gas infrastructure that is set to boom unless we take urgent action to take a clean energy pathway.
Beyond ruling out finance for new projects, the commitment should be reflected in rapid reductions in the bank’s debt and equity exposure to fossil fuels over the next ten years. Remember that Westpac has a large fund management arm, holding shares and stakes in companies and projects around the world. Selling down these stakes and getting out of the fossil fuel business will need to happen as quickly as possible for the bank.
Click here to learn more about banks and the two degree global warming limit.
Click here to see this news reported in the Australia Financial Review.
What we need to do
It took a lot of work over several years by many groups to get Westpac to this point. But we can’t afford to rest on our laurels and expect that this commitment will deliver the outcomes described in the last section. As always, it will be down to the community to hold Westpac accountable to their commitment on climate change action, watching their every move. Don’t worry – Market Forces can help act as your eyes! This involves everyone – shareholders will need to make sure the commitment given to them is upheld, customers will need to put Westpac “on notice” that the bank needs to stay in line with this commitment to keep their business, and the public need to watch the bank, calling them out on anything that looks like it steps outside of the commitment to keep global warming below two degrees.
Together we got this commitment and together we can make sure Westpac delivers on it!
Spread the word!
— Market Forces (@market_forces) December 11, 2015