HSBC exposed as the banker behind Indonesia’s deforestation crisis

Press release - January 17, 2017
Greenpeace International exposed in a new report today how HSBC, Europe’s largest bank, loaned hundreds of millions of US dollars to some of the most destructive palm oil companies in Indonesia. [1]

In the past five years alone, HSBC has been part of banking syndicates that arranged US$16.3 billion of loans (and nearly US$2 billion of bonds) to six companies whose palm oil operations have destroyed vast areas of rainforest, peatland and orangutan habitat in Indonesia. [2]

Deforestation and peatland destruction by Indonesia’s palm oil and pulp sectors is widely acknowledged as a root cause of forest fires and haze. A study by Harvard and Columbia universities estimates that over 100,000 adults across Southeast Asia died prematurely as a result of the 2015 haze crisis. [3][4]

The report documents loans and financial services from HSBC to palm oil companies responsible for: 

  • destroying rainforest, including orangutan habitat
  • seizing land from local people
  • operating without legal permits
  • abusing workers and using child labour
  • forest fires
  • draining and developing carbon-rich peatland 

Many of these actions breach the laws and regulations that govern Indonesia’s plantation sector. Lending to these companies also breaches HSBC’s sustainability policies. [5]

In New Zealand, the widespread use of palm oil by-product, Palm Kernel Expeller (PKE), by the agriculture industry as a supplementary animal feed has been widely criticised.

Following public pressure, Landcorp announced last year it would completely phase out its use of PKE. Fonterra then agreed to cut back its use of the product, although it has not committed to eliminating it completely.

New Zealand is currently the largest importer of PKE, using about a quarter of the world's supply each year as supplementary feed for livestock.

Greenpeace New Zealand Forests Advisor, Grant Rosoman, says the connection between palm oil and massive rainforest destruction is a global issue that countries around the world must take responsibility for. 

“Even in a small country like New Zealand we’ve seen that our agriculture industry has been complicit in fuelling the draining of peatland in Indonesia and the devastating fires that followed,” he says.

“And now we’re seeing that Europe’s largest bank, HSBC, also has blood on its hands. HSBC has many branches here in New Zealand. As a global bank, this means that every office - even the ones here - have been linked to financing destruction.”

Rosoman says companies in Indonesia’s palm oil sector use deliberately complicated corporate structures to avoid scrutiny. 

But by analysing corporate financial data and company accounts, as well as through field research, Greenpeace International has traced those responsible for forest destruction back through their parent companies to HSBC and a host of other international banks.

“The smoke that comes from clearing forests and draining peatlands puts my family in danger, year after year. The banks and companies driving this crisis must take responsibility for polluting our air,” said Nilus Kasmi Seran, an indigenous Dayak and volunteer firefighter from Ketapang, West Kalimantan.

Last year the International Union for Conservation of Nature changed the classification of the Bornean orangutan from ‘endangered’ to ‘critically endangered’, citing ‘destruction, degradation and fragmentation of their habitats’ including conversion to plantations, as a main reason for the decline in population. [6]

Greenpeace analysis of figures released by the Indonesian Ministry of Environment and Forestry suggest 31 million hectares of Indonesia’s rainforest has been destroyed since 1990 - an area nearly the size of Germany. [7] Indonesia has now surpassed Brazil as the country with the world’s highest rate of deforestation, and today less than half of its peatlands remain forested.

Note to Editors:

[1]  Greenpeace International’s Dirty Bankers report is available for download here:

[2]  The six companies are: Bumitama, Goodhope, IOI, Noble, POSCO Daewoo and the Salim group / Indofood.

Total amount of loans involving HSBC since 1/1/2012 (including matured) for these six palm oil groups: US$16,341,898,120.

Total amount of bonds involving HSBC since 1/1/12 (including matured) for these six palm oil groups: $1,996,087,395

[3] e-caused-100000-premature-deaths

[4] The financial toll has also been enormous. The World Bank estimates the cost of the 2015 fires to Indonesia at US$16 billion – twice the estimated value added from Indonesia’s 2014 gross palm oil exports.

[5]  HSBC’s Forestry and Agricultural Commodities policies can be viewed on its website:

[6]  International Union for Conservation of Nature.

[7]  Mapping analysis from Greenpeace International’s Under Fire report, available here: