Financial Sector Ecology Question 2
Does the brand identify higher risk areas / countries requiring extra attention outside of the general (if any) biodiversity policy and does the brand have a strict policy on this?
German version: Weist das Unternehmen auf Gebiete bzw. Länder hin, in denen stärker auf die Einhaltung des Schutzes der Artenvielfalt geachtet werden sollte und verfolgt es dabei eine strikte Politik?
The banking sector has a significant impact on biodiversity, particularly those banks that provide financial support to high-impact sectors such as forestry, mining, oil and gas, fisheries, water delivery and infrastructure, or sectors that are using genetic resources such as biotechnology, pharmaceuticals, agriculture or cosmetics. To deal with the risks related to biodiversity, banks should adopt policies that take into account the protection of biodiversity as reflected in international conventions and national laws. Such a policy should set criteria for all financial services for new projects or investments, especially when provided to clients in high-impact sectors. (Mind The Gap p.70).
Sectors/Activities: Deforestation. By financing companies in the forestry sector, financial institutions can have a significant impact on forest conversion, degradation and destruction. A financial institution providing services to this sector must therefore develop a policy that sets conditions which should be met before providing financial services. The most widely recognised (and consequently supported by all major environmental and development NGOs) certification scheme which deals with this subject is the Forest Stewardship Council (FSC), which represents forest owners, forestry companies, trade unions and social and environmental organizations. FSC has formulated ten Principles of Forest Stewardship. With the associated criteria these form the basis for all FSC forest and plantation management standards. ` Other Sectors: Fisheries, Agriculture, Mining
Financing and Underwriting - Look if a brand identifies higher risk sectors and has developed a policy concerning biodiversity for them. Reward a 'Yes' if the brand has stated that it is not active in the following activities or sectors OR has the following included in their policies:
Forestry / Deforestation
Applicable to forestry, agriculture (especially soy), meat production, leather production and mining. Brands should only work with FSC certifications for all involvement in wood and forestry; agriculture and relying meat and leather production for which no rainforest was logged, only in that case a ‘Yes’ should be rewarded.
Only reward ‘Yes’ when the brand’s policy commits to the FAO Code of Conduct for Responsible Fisheries for financial services provided to the fisheries sector directly (Mind the Gap, p.39) OR the brand pays particular attention to assesses companies active in this sector on the sustainability of their product.
Only award ‘Yes’ when the brand’s policy sets as precondition for its financial services the best international standards for at least three of the elements listed in Mind the Gap p. 29 paragraph 3.1.3
Only award ‘Yes’ when the brand’s policy sets as precondition for its financial services at least three of the elements listed in Mind the Gap p.60 paragraph 3.6.3.
Investing – Brand does not make active investments in companies involved in the above sectors unless they meet the criteria OR only invest in the best in class companies from a biodiversity / environmental context