The hidden costs behind our banks' unreal profits

Our Sustainable Food Advocacy Team, has spent the last six months investigating Australia’s big four banks in the lead up to the release of our latest report: Still Banking on Land Grabs.

Before this report’s release next Monday, Food, Climate and Humanitarian Advocacy Manager, Kelly Dent, sets the scene — contrasting the banks’ continued unreal profits with their often hidden costs:

The banks’ balance is not what it seems.

As reported last year on 60 Minutes, “The big four banks like to tell us how much profit they’ve made each year. But they don’t tell you about the hidden costs of their business.”

Despite the hubris at AGM time, the big four banks’ ledger is not good. Last year, ANZ, CBA, NAB and Westpac announced the unreal combined profit of $30.8 billion.

But this unreal profit came at a very real cost.

While trumpeting their success during the reporting season, each of our big four banks continued to remain exposed to companies linked to agriculture and timber related land grabs. And despite our banks’ bumper profits, none have helped affected communities to return to their land or access adequate compensation.

Land grabs are costing communities.

Often enforced through violence and intimidation, the taking of land without community consent impacts on local food systems, on livelihoods, and on peoples’ identity and culture. The loss of land can be so traumatic that it has lifelong impacts on people’s mental health.

Our big banks need to be as transparent about whom they do business with, as they are about their profit statements.

Transparency is central to ending land grabbing.

That’s why we’re opening the ledger.

Unreal profits

As our big four banks describe it, they had an impressive year.
Together they trumpeted a combined profit of $30.8 billion in 2015.
At AGM time, the banks were eager to remind us of the importance of social and environmental practices in their business practices that contributed to their profits.
ANZ said it is building…”the most respected bank across the Asia Pacific region, to help deliver prosperity for our customers and the communities in which they live.”
CBA’s chairman told its shareholders that it wants to be “the ethical bank, the bank others look up to for honesty, transparency, decency…”.
NAB’s CEO said that their vision is “to be the most respected bank in Australia and New Zealand” and that a valued part of their culture is to “do the right thing”.
Westpac is touting its credentials as an industry leader on the Dow Jones Sustainability Index.

Hidden costs

On the other side of the ledger, 1.6 million hectares of land has changed hands through large-scale land acquisitions in 2015.
Much of this has taken place in the agriculture and timber sector and without the consent of local communities.
Total land grabs are estimated to cover tens of millions of hectares.
Land grabbing was rated sixth in terms of importance from a list of all global business and human rights issues in 2015.
None of Australia’s big four banks have supported compensation resulting in concrete improvements in the day-to-day life of communities affected by land grabs.
While banks promote their hardship policies to help Australian homeowners, they have not supported the communities left homeless by agriculture and timber land grabs they have supported overseas.
Banks are touting their support for women in leadership – but what about the women impacted by their support of land grabbing? Women and girls are disproportionately impacted by land grabs and the subsequent breakdown of communities.
Communities in developing countries still have no way of finding out if one of our banks is backing agriculture or timber companies operating in their area.
All the banks discussed land grabs in their annual reporting but no bank has committed to being more open about who they do business with. CBA and ANZ have still to properly acknowledge several claims of links to land grabs.

Keep an eye out for the latest in the campaign to end our big banks’ support for land grabbing with the release of the Still Banking on Land Grabs report on 15 February.

In the meantime, if you haven’t already, please ask your bank to show a zero tolerance for land grabs.