Pakistani Banks overlooking climate change and human rights
in loan practices
Pakistani banks are facing criticism for their inadequate
policy commitments regarding climate change, human rights, gender equality, and
labor rights. Notably, none of these banks discloses policies related to nature
and taxation when extending loans to businesses.
Senator Farhatullah Babar raised these concerns during the
launch event of the report titled "Benchmarking the sustainability
policies of banks in Pakistan," conducted by Fair Finance Pakistan.
The report evaluated the policies of major banks, including
Habib Bank Limited (HBL), Allied Bank Limited (ABL), National Bank of Pakistan
Limited (NBP), Meezan Bank Limited (MBL), and MCB Bank Limited (MCB). The
assessment covered areas such as climate change, corruption, gender equality,
human rights, labor rights, nature, arms, tax, transparency and accountability,
and financial consumer protection.
Pakistani
banks receive low ratings in human rights policies
Banks received low scores in financial consumer protection
(4.62/10), corruption (3.18/10), gender equality (1.48/10), and transparency
and accountability (1.08/10). The overall average score for the top five banks
was less than one out of ten, highlighting a lack of comprehensive public
policies on sustainability benchmarks.
The top five banks exhibited zero scores in nature and tax
policies, indicating a disregard for these benchmarks by both the regulator and
the banks themselves. Asim Jaffry, Country Program Lead at Fair Finance
Pakistan, emphasized the need to redirect finance to address societal concerns
and underscored the importance of efforts to ensure a clean environment for
future generations.
Officials
discuss climate change initiatives with senior bankers
In addressing climate change, the five banks received an
average score of 0.5 on a scale of 0 to 10, with zero representing the least
desirable approach. None of the banks had formulated a climate policy aligned
with the Paris Agreement.
Furthermore, the survey revealed that no bank had declared
human rights policies regarding investment or funding. The top five commercial
banks scored less than one out of ten on labor rights policies, with no public
labor rights standards. Interestingly, all banks, namely HBL, MBL, ABL, MCB,
and NBP, received a zero score on nature and arms.
SBP
underlines need to create resilience against impacts of climate change
None of the banks provided details on promoting equal
participation and access to senior positions for women. Additionally, none
demonstrated how they incorporate a gender perspective in their lending
practices.
Lastly, the five banks exhibited low commitments to tax
policies. Despite their global operations, HBL, MCB, ABL, and MBL did not
disclose information on profits, revenues, subsidies, or taxes overseas.
Source: Pro Pakistani