Banking against the Reef

by Richie Merzian

The Great Barrier Reef Foundation (the Foundation) does not have a policy to guidethe investment of its undisbursed funding. As part of the $443.3 million GrantAgreement with the Australian Government, the Foundation must design an “investment policy” – however the Grant Agreement is silent on whether the policyshould exclude investing in fossil fuel industries that directly contribute to climatechange.The Foundation has already received all six years of grant funding, which is currently sitting in term deposits with six banks (five of which have connections to theFoundation’s Chairman’s Panel). These banks benefit from the half a billion dollars on their books, which facilitates their wider business. The Foundation’s banks include the Big Four (Commonwealth, Westpac, ANZ and NAB) that are responsible for the majority of lending to the fossil fuel industry in Australia. In terms of scale, the Big Four last year lent to fossil fuel projects that will emit the equivalent of almost ten times Australia’s total 2017 emissions. If the Foundation is to gain credibility in its role protecting the Reef, it needs to align its investments with the health of the Reef. Firstly, the Foundation should divest from the Big Four partners and select banks committed to not funding industries that directly contribute to climate change – and over 50 local options exist. Secondly, the Foundation should build an investment policy that screens out any companies that directly contribute to threats to the Great Barrier Reef, including climate change.

This report explores the fossil fuel divestment movement and, on the other side of the coin, the fossil free investment movement. In addition to the benefit of aligning investments with an organisation’s purpose, the report finds the returns available on local and international fossil free investment indices to be competitive, if not superior, to standard investment portfolios.


Full report