HSBC drops shares in forest trashing Sinar Mas

Posted by jamie — 8 July 2010 at 9:21am - Comments

Wahey, you've scored another victory! After receiving nearly 10,000 emails (and seeing some excellent spoof adverts), HSBC has sold its shares in Sinar Mas, one of the worst companies responsible for ripping up the Indonesian rainforest for palm oil and pulp plantations. It's fantastic news (as The Guardian was quick to agree) that has shone a light on the financial side of deforestation. And you made this happen - thanks!

Of course, this development comes hot on the heels of Nestlé's decision to remove Sinar Mas from its supply chain and the news this week (prompted by our new report into Sinar Mas' paper operations) that Tesco will also stop selling own-brand products using Sinar Mas paper by the end of this year.

We've been talking to HSBC executives for some time about their holdings in Sinar Mas and, even though they've been a bit cagey about exactly what they've done, it's clear that without thousands of people emailing the CEO Michael Geoghegan they wouldn't have made dumping the Sinar Mas shares a priority.

There's still, however, the small matter of HSBC's forest policy which applies to some areas of their business but not others. They haven't said they'll be changing that, although there is a review scheduled for September to decide whether to exclude palm oil from its Climate Change Fund, where some of those Sinar Mas shares were held. We'll be keeping tabs on the process and will let you know how it turns out.

But in the meantime, let's reflect on the progress we've made so far this year. Unilever and Kraft announced they would suspend Sinar Mas contracts for palm oil. After a massive campaign, Nestlé followed suit and has adopted an anti-deforestation policy for their business. And now HSBC has dropped its Sinar Mas shares.

So what next? On the financial side of things, we'll be asking other Sinar Mas investors, like USB and Credit Suisse, to follow HSBC's lead and divest their interests in the company. And we'll be following up on the investigations for Pulping the Planet which revealed how the paper arm of Sinar Mas - Asia Pulp & Paper aka APP - is also tearing its way through Indonesia's rainforest to feed its paper mills.

It's only half way through 2010. What do you think we can achieve by the end of the year?

It was all down to you!

web editor

It was all down to you! web editor gpuk

It's entirely up to you, but there are other banks with far better ethical policies than HSBC - here are some of the details.

About Jamie

I'm a forests campaigner working mainly on Indonesia. My personal mumblings can be found @shrinkydinky.

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