The new policy will require HSBC customers to:

• Commit to protecting natural forest and peat by 30 June 2017.
• Identify and protect forests and peat in new plantations prior to commencing new development.
• Provide independent verification of their No Deforestation, No Peat, No Exploitation commitments by 31 December 2018.

According to Stuart Gulliver, the group CEO of the bank, ‘in the short transition period before customers have to make a commitment to NDPE, HSBC will not agree new financing facilities to customers who have not made the appropriate commitment’ and ‘will not knowingly provide financial services which directly support palm oil companies which do not comply with our policy.’ The bank has also taken steps to join various initiatives and alliances that promote its new policy.

This huge step taken by the renowned bank is laudable and serves as an example of the steps which banks can take to ensuring sustainability in their supply chain. However, the proper implementation of the policy will be the icing on the cake.

Links:

http://www.hsbc.com/news-and-insight/media-resources/media-releases/2017/hsbc-statement-on-revised-agricultural-commodities-policy Accessed 7th April 2017

http://m.greenpeace.org/international/en/high/news/Blogs/makingwaves/hsbc-palm-oil-deforestation-indonesia-new-policy/blog/58787/ Accessed 7th April 2017

http://www.greenpeace.org.uk/media/press-releases/new-hsbc-%E2%80%98no-deforestation%E2%80%99-policy-first-step-towards-sustainable-palm-oil-finance-20170220?_ga=1.263353033.437101606.1488877777 Accessed 7th April 2017