How our financial system is bankrolling extinction and what governments need to do to restore nature

The world is facing multiple crises when it comes to our climate and environment – we know this too well. We are direct witnesses of this destruction and the suffering it causes in our respective countries, Brazil and Indonesia, two countries that are home to ecosystems vital to the ecological balance of our planet.

We follow international efforts to protect and restore nature with concern, determination and hope. As part of efforts to tackle the biodiversity crisis, nearly 200 governments signed the Global Biodiversity Framework (GBF) in December 2022. One of the goals of this agreement is to maintain, enhance and restore the integrity and resilience of ecosystems.

This means we need to stop the destruction of nature right now and allow the recovery of these ecosystems. This should apply not only to forests like the Amazon, Congo Basin or Carpathian forests, but also to other essential ecosystems such as savannahs (like the Cerrado) and wetlands (like the Pantanal, South America’s largest wetland extending across Bolivia, Brazil and Paraguay). This action would produce the highest impact in the shortest time. But how do we get there?

October 2020: Unprecedented fires are consuming vital biomes across Brazil, including the Pantanal wetlands. Greenpeace Brazil activists are mobilising to highlight the fact that these fires are the result of the Bolsonaro government’s anti-environmental agenda and the dismantling of environmental protections since it took office. © Diego Baravelli / Greenpeace

A drastic reform of the financial system is urgently needed to address the ongoing loss of species and natural areas

Commitments to tackle the climate and biodiversity crises are being undermined on a daily basis by a finance system that serves polluters and the funding of industries and projects that accelerate environmental degradation and species extinction. Billions continue to flow unabated into destructive activities.

Therefore, a drastic reform of the financial system is key to address the ongoing loss of species and natural areas, and emissions. As long as money continues to flow towards expansion of economic activities that lead to nature destruction, there is no way we will be able to meet these commitments.

Activists are at the 2023 Monte Carlo Rendez-Vous – the biggest annual insurance and reinsurance conference – to urge insurance companies to stop supporting the climate crisis. Oil companies want to drill in the Congo rainforest, destroying communities and biodiversity, and insurance companies shouldn’t prop them up. Banners read “Don’t insurance rainforest destruction” and “Ask me why I don’t want oil in the Congo rainforest”. © Greenpeace

In the Global Biodiversity Framework, governments committed (target 14) to ensure that all financial flows would be aligned with the biodiversity conservation goals and targets before 2030. This means governments need to better control public and private money flows.

Governments need to improve existing regulations and develop new regulations that prohibit large banks and other finance institutions from investing in activities that harm the world’s remaining biodiversity – all coupled with rigorous enforcement and transparency, to stop nature destruction and hold wrongdoing to account.

Trillions of dollars in subsidies and investments continue to finance the destruction of natural ecosystems

We are living through a climate and biodiversity crisis, but governments and the private sector are spending around 3.1 trillion dollars a year on harmful subsidies and investments in problematic sectors such as livestock, timber and palm oil production, leading to the destruction of nature and violations of human rights.

We need legally binding regulations that prohibit banks, asset managers, pension funds and other financial institutions or investors from financing farms, projects and companies that harm ecosystems and local communities depending on them. This is especially true for Indigenous Peoples, and land and environmental defenders who continue to be attacked despite their vital work for protecting the environment and fighting climate change.

December 2022: Great March led by Indigenous leaders for Biodiversity and Human Rights during COP15 in Montreal as countries are negotiating the Global Biodiversity Framework. © Greenpeace / Toma Iczkovits

Global government spending on activities leading to biodiversity conservation is estimated at 154 billion USD per year only, while estimates of the total amount of subsidies and other perverse incentives are much higher as mentioned above. The redirection of these financial flows could generate major funding for the very actions the GBF recognises are at the heart of biodiversity conservation. It could also ensure a just transition in sectors like industrial agriculture and forestry that continue to harm not just biodiversity, but also the communities that depend on these sectors for their livelihoods.

As Governments are preparing their plans on how to implement the commitments they have made in the historic Kunming-Montreal Global Biodiversity Framework, we urge them to adopt regulations of the finance sector, control financial flows, and stop and reverse the destruction of natural ecosystems.

The people’s movement against the governments and institutions that are destroying nature is growing stronger every day

For centuries, Indigenous Peoples and local communities have opposed the injustice and destruction of nature. Over the last few decades, an international people’s movement to defend natural ecosystems has developed, bringing together millions of people and growing stronger every day.

In October, hundreds of environmental activists blockaded the offices of Rabobank in the Netherlands and demanded that the bank stop financing industrial agriculture, which is destroying biodiversity, and pay for the damage caused.

October 2023: Activists Block the Entrances to Rabobank Headquarters in Utrecht. Extinction Rebellion and Greenpeace Netherlands are taking peaceful action against Rabobank’s devastating agricultural policies. © Marten van Dijl / Greenpeace

Rabobank, a Dutch bank, is a case in point. The bank has made billions by financing companies that destroy nature over many years, both in its home country, the Netherlands, and elsewhere, for example in our two home countries, Brazil and Indonesia.

In recent years, many other banks and financial institutions that are bankrolling extinction have been the target of damning reports and powerful actions in many countries around the world, including JP Morgan, Barclays, Standard Chartered and Deutsche Bank.

It is impossible to protect and restore natural ecosystems without tackling the international finance that allows so many industries to pollute and destroy with impunity. Governments must come up with serious and time bound plans to reform the financial system. Only a powerful people’s movement, fully involving Indigenous Peoples and local communities, can force them to do so.

Cristiane Mazzetti and Syahrul Fitra are campaigners at Greenpeace Brazil and Greenpeace Indonesia.