• Indonesia’s second-largest coal mining company, Adaro, which claimed to use its profit boom to lead Indonesia’s green shift, is continuing to raise funding for coal expansion.

• Over 58,000 people have called on global banks to break ties with Adaro and stop funding its coal expansion. 

• Activists around the world demonstrated to demand that major banks stop funding Adaro’s coal expansion projects. 

NGOs and local communities around the world gathered last week to demand that global banks stop financing Adaro Energy Indonesia and facilitating any of its future bonds. Adaro, Indonesia’s second-largest coal mining company and one of the world's largest exporters of thermal coal, keeps growing its empire at the expense of the human rights of Indonesian local communities and Indigenous peoples and biodiversity, all while driving us all towards climate chaos.

During the Adaro Action Days, promoted by BankTrack, Ekō, Market Forces, and the Toxic Bonds Network, activists and campaigners targeted Adaro’s financiers in Jakarta, New York City, Frankfurt, Tokyo, and Zurich. They raised their voices, calling on Bank Mandiri, Citi, DBS, Mizuho, Sumitomo Mitsui Banking Corp, Mitsubishi UFJ Financial Group, UBS, and Deutsche Bank to stop facilitating any new bonds issued by Adaro and rule out financing for Adaro and any other company involved in coal expansion activities. Activists demonstrated outside the banks’ headquarters, declaring “Break up with Adaro”, and “End Coal Finance now!

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Action against Bank Mandiri’s financing of coal expansion.

Photo: Market Forces

Adaro Energy’s USD 750 million bond will mature on October 31, 2024, with a high probability that the company will issue a new bond to refinance it and continue its coal expansion. Mandiri, Citi, DBS, Mizuho, SMBC, MUFG, UBS, and Deutsche Bank have all either underwritten Adaro bonds in the past or provided direct financing. Their current policies would still allow them to provide underwriting services for the upcoming bond and facilitate Adaro’s fossil fuel expansion.

Actively financing coal expansion is nothing new for these banks. Since 2016, they collectively provided over USD 137 billion for thermal coal mining, coal power, and metallurgical coal mining, according to the Banking on Climate Chaos 2024 report. Adaro alone received over USD 1,33 billion in financing between 2016 and 2023, according to Banking on Climate Chaos 2024. The internal policies of the world’s major banks still allow their clients’ money to be invested into the companies that keep grossly contributing to the climate crisis. Deutsche Bank, for example, received criticism for its policy of applying stringent restrictions for new clients while continuing to finance existing clients which have “credible transition plans”, without sufficiently defining or disclosing what a credible transition plan is. 

By continuing to associate with Adaro, these banks are financing a company whose 70% of revenue comes from thermal coal (GCEL). Acknowledging the pressure for a global energy transition, Adaro has promised its financiers that it intends to cease dependence on coal. Last week, Adaro Energy Indonesia, a subsidiary of the Adaro Group, announced plans to offload 99.9% of the shares in its coal unit Adaro Andalan Indonesia. However, the company has not announced a cap on coal production or a complete exit from coal. In fact, it plans to expand metallurgical coal production by restarting and expanding operations at existing coal mines in Indonesia and Australia. By simply offloading shares, Adaro Energy Indonesia could be setting the stage to access a new base of investors and more finance that could still be directed to its coal operations. A lack of clear commitment from major banks will continue to allow coal miners like Adaro to receive sustained financial support to continue their climate-wrecking coal expansion. However, following our action in Frankfurt and the delivery of a petition signed by more than 58,000 individuals, asking banks to quit doing business with the coal miner, and according to the Frankfurter Rundschau, Deutsche Bank is not planning to refinance the Adaro bond.

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Action against Deutsche Bank’s financing of coal expansion.

Photo: BankTrack

Adaro has also recently been in the eye of controversy because of allegations by corporate watchdog Ekō of illegal mining, biodiversity destruction, pollution of water sources, and human rights abuse. The report “In Coal Blood - How Adaro Destroyed Indonesian Biodiversity” found that Adaro mining activities in South Kalimantan, Indonesia, extend far beyond its permit area. Thus, Adaro could be illegally mining for coal by destroying Indonesian pristine rainforests and exacerbating climate destruction. 

“We are in the middle of a climate crisis and it is absolutely outrageous that we are still financing coal expansion. Companies like Adaro are building empires at the expense of the human rights of local communities and Indigenous peoples, the environment, and our climate. We cannot remain silent and we demand that banks stop hiding behind vague and empty promises, see beyond Adaro’s blatant greenwashing, and publicly commit to ruling out Adaro and its subsidiaries as clients and ruling out any future financing of other companies involved in coal expansion. We need to end coal finance, now!” said Camilla Perotti, Climate Campaigner at BankTrack.

“We are facing a climate emergency, yet banks continue to fuel the coal industry, enabling companies like Adaro to profit at the expense of our planet, communities, and future generations. This is a betrayal of our shared responsibility to protect human rights, Indigenous lands, and the environment. We can no longer accept vague commitments or greenwashed excuses. Banks like BNP Paribas and Deutsche Bank seem to have already to refused to refinance Adaro’s upcoming bond. Other banks must take a stand too—end their support for Adaro and its subsidiaries, and commit to a future free from coal financing. The time to act is now; we cannot afford to delay any longer,” Apekshita Varshney, Climate Finance Campaigner at Ekō, said.

“It’s alarming that amid increasing extreme disasters caused by the climate crisis in Indonesia and around the world, Indonesian national banks continue to finance coal projects. Indonesian national banks, like Bank Mandiri, are funding the construction of Adaro’s coal-fired power plant in North Kalimantan, contradicting the Indonesian government’s commitment to accelerate the early retirement of these polluting plants. The climate commitments of Indonesian national banks lag far behind the global trend, where more financial institutions are moving away from coal financing in line with global climate goals.” Binbin Mariana, Asia Energy Finance Campaigner at Market Forces, said.