The bank said a preliminary assessment of relevant business customers found 9 per cent of them received a “D” rating on their transition plans, meaning they would be declined new finance.
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But critics have accused the bank of watering down its climate position, with Market Forces senior bank analyst Morgan Pickett saying: “Westpac has betrayed its shareholders and customers by scrapping its science-based climate policy and replacing it with one so full of loopholes it looks like Swiss cheese.”
Australian Ethical argued Westpac’s changes meant the bank could continue financing companies engaged in fossil fuel expansion, contrary to previous commitments. “Westpac is no longer the climate frontrunner among the big four banks,” ethical stewardship lead at Australian Ethical, Amanda Richman, said.
Last year Westpac faced a similar shareholder resolution, which was knocked back but attracted support from 34 per cent of votes cast.
Another closely watched vote at Westpac’s AGM on Thursday will be the re-election of non-executive director, Peter Nash, after two proxy firms reportedly recommended shareholders oppose Nash’s re-election, pointing to his time on the board of ASX Limited, which has faced a series of setbacks lately. Westpac’s board has backed Nash’s re-election.
NAB’s annual meeting, to be held in Melbourne a day after Westpac’s, will not include a vote on climate change issues after Market Forces withdrew a resolution after the bank’s latest climate report was released.
In a new front for banks, however, NAB is facing a resolution that would require the bank to disclose how much it lends to customers involved in “deforestation,” which refers to when natural forests are lost because the land is converted to farming, tree plantations or there is severe and sustained degradation.
NAB’s board, which opposes the resolution, says the bank has improved its approach to investigating suspected illegal land clearing by customers, and it is developing how it deals with this risk, including by training bankers.
The ACF has previously said the expansion of the beef industry is the top driver of deforestation in the country – and NAB is the largest agribusiness bank in the country. Italy’s Anima and US-based Calpers have indicated they are voting in favour.
It is not clear if the resolutions will be backed by Australian super funds. Major funds AustralianSuper, Australian Retirement Trust and HESTA did not disclose their voting intentions before the meetings.
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