Since the 2015 Paris climate agreement, European banks have lent about €256 billion to corporations that put forests, savannahs and other climate critical natural ecosystems at risk, according to new research. 

The study, published by Greenpeace International, Milieudefensie (Friends of the Earth Netherlands), and Harvest and supported by other NGOs, (including BankTrack) is based on data compiled by the independent research organisation Profundo. The study focuses on JBS, Cargill, Sinar Mas and other top global producers, processors and traders of soy, cattle, palm oil, rubber, timber and other commodities that carry a high risk of ecosystem destruction, and the financial institutions that finance them. The EU is the second-largest global financial hub bankrolling these commodities sectors. 

European finance sector is bankrolling ecosystem destruction

The report shows that some of the largest banks based in the EU, such as BNP Paribas, Santander, Deutsche Bank, ING Group and Rabobank, provided a staggering 22.1% of total global credit between 2016 and early 2023 to big players in sectors that put nature at risk. The vast majority (86.6%) of this European credit came from banks based in France, the Netherlands, Germany and Spain. Banks, pension funds, and asset managers based in the EU also provide 9.4% of current global investments to nature risk sectors. 

The organisations publishing the report are demanding EU regulation to stop money flowing to companies that destroy nature, and align the financial sector with global climate and biodiversity targets. 

“Europe thinks highly of itself for climate and nature protection, but looks the other way as its banks pour money into companies linked to massive nature destruction and related human rights abuses. There is a clear pattern, the EU financial sector’s links to ecosystem destruction are widespread. We can’t fight the climate crisis and ecological collapse while at the same time bankrolling extinction.” 

-Sigrid Deters, biodiversity campaigner at Greenpeace Netherlands

"The evidence is loud and clear: European banks are continuing to finance the destruction of forests around the world to the tune of billions of euros. Yet the financial sector is excluded from the EU’s anti-deforestation law, undermining efforts to meet global climate and biodiversity goals. It is time for the EU to put the brakes on the financial institutions that are destroying the planet.” 

-Giulia Bondi, senior campaigner Forests at Global Witness

“Our research shows that banks and investors are not changing voluntarily: they are still pumping billions of euros into companies that destroy nature. Biodiversity hotspots vital to climate stability, such as the rainforests of the Amazon, Southeast Asia and the Congo Basin, or the northern boreal forests, are disappearing at an alarming rate. The EU urgently needs to show leadership by regulating its financial sector and stopping the flow of money into climate disruption and nature destruction.” 

-Jonas Hulsens, senior policy officer Forests and Climate Justice at Milieudefensie

Anti-deforestation legislation 

The EU deforestation regulation, adopted in May 2023, is a first step towards meeting the EU’s global climate and biodiversity commitments. It intends to reduce the impact of EU consumption, by requiring companies to sell only deforestation-free and legally produced products within the EU. 

Loophole for financial flows and nature destruction 

However, while current EU rules address physical products placed on the EU market that put forests at risk, they do not cover the money flowing to ecosystem destruction. The European Commission is on a timetable to review the role of finance in deforestation and forest degradation and, if necessary, make a legislative proposal by June 2025. 

Environmental and human rights organisations are urging the EU to close this loophole in the law, and stop financial flows to nature destruction. The EU rather needs to put its efforts in directing money flows to support restoration of ecosystems and struggling farmers to transition towards more resilient and ecological farming. 

Download the report