‘We are witnessing a fire-sale of the world’s rainforests’ –global banks earn billions from deforestation

New Global Witness research exposes glaring contradiction at the heart of forest finance, as Brazil prepares to launch flagship tropical forest fund at COP30.

Read the full report here.

Financial institutions have made US$26 billion from financing deforesting companies since the Paris Agreement was signed in 2015 – averaging around $7 million every single day – according to a new report released by Global Witness today.

The investigation, based on data from Dutch research consultancy Profundo, reveals how some of the world’s biggest financial institutions – including Vanguard, JPMorgan Chase, BlackRock, BNP Paribas and HSBC – have reaped billions through investments, loans and issuance underwriting services provided to 50 companies accused of forest destruction around the world.

The findings represent the largest ever mapping of incomes related to deforestation, revealing the global financial system’s significant role in deforestation and the need for robust national rules to prevent deforesting businesses from receiving funds.

Overall, the analysis found:

• US banks earned the most globally, making $5.4 billion, with Vanguard, JPMorgan Chase and BlackRock topping the list.
• EU banks generated $3.5 billion, led by BNP Paribas and Rabobank, while UK banks made $1.2 billion, with HSBC, aberdeen Group and Schroders at the top.
• Together, banks in all other countries including Indonesia and Brazil earned $15.9 billion.
• Chinese financial institutions made $1.2 billion, almost entirely from credit-related deals and fees – despite the country’s green finance policy requiring banks to restrict lending for companies with ESG concerns.

All financial institutions named here were contacted by Global Witness. Their responses can be found in the main report.

Importantly, the $26 billion total includes only those incomes which represent each company’s deforestation-related activities. When considering all banking and investment services provided to these companies, across all of their lines of business, earnings climb to $104.7 billion.

Of the deforesting businesses across the six sectors analysed, the pulp and paper sector generated the highest income (48%) followed by palm oil (41%), then soya (4%), beef (3%), rubber (3%) and timber (1%).

The analysis cautions, however, that relative profits are not a direct reflection of a sector’s deforestation impact. For instance, beef production – though less capital-intensive than some of the sectors examined in this study, such as palm oil or pulp and paper – remains one of the world’s leading drivers of deforestation, even if meatpackers linked to deforestation appear to generate comparatively lower returns for financiers.