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Stuart Palmer
13 December 2016
2 min read

Last Friday our Head of Ethics, Stuart Palmer, asked the Westpac chairman to rule out funding the Adani coal mine. Here’s the transcript of the question.

Stuart Palmer from Australian Ethical Investment, a longstanding institutional investor in Westpac. 

My question is about how the bank is responding to climate change. We have heard about  the bank’s sustainability reporting about the scenario modelling work the bank is doing to help it ensure its loans are consistent with limiting warming to below 2 degrees.

Whilst this is positive news we have yet to see any effect of this work. Moreover, recent statements by the Chairman and CEO have raised uncertainty about whether Westpac’s climate policy will in fact change investment practice.

My question, as a responsible investor is about the proposed Queensland Carmichael coal mine. If developed this mine would be one of the world’s largest coal mines in the world. It would be the largest coal mine in Australia. It will mine some of the dirtiest type coal in a remote location. At peak capacity, it would produce the same amount of greenhouse gas emissions in a year as the UK’s annual emissions from electricity generation.

Many competitor banks have specifically ruled out financing this new mine project. They have made the conclusion that exporting and burning Carmichael coal is inconsistent with climate change policy and the necessary reductions the world needs to make in fossil fuel emissions to limit warming to 2 degrees.

Now, to help shareholders assess the effect of the bank’s climate policy and to help close the trust gap which the CEO has referred to, can you please tell us whether lending to Carmichael is or is not consistent with Westpac’s climate commitments.”

Lindsey Maxsted, Chairman of Westpac Group

Thank you for your question. Two points.

One, as I said earlier, we don’t comment on particular customers or potential customers, secondly if we were to lend to Adani or if we were asked to lend to Adani then it would fit into the same criteria as answered in the previous question, we would look at it and if it were inconsistent with what we believe in terms of working towards carbon neutrality in 2050 then we would not lend. But we do review every customer or every potential customer that’s put before us and we make our choices as to whether we lend or not lend based on credit and other considerations obviously including environmental.

Stuart Palmer, Australian Ethical Investment

Thank you. For us it is very clear. If we’re going to be responsible investors and responsible lenders than we cannot fund projects like the Carmichael mine and other projects in the Galilee Basin and we think it’s very important that we say we won’t fund them.

Lindsey Maxsted, Chairman of Westpac Group

I understand.