The directors of Canada’s top five banks hold more extensive ties to polluting industries than their international counterparts, new analysis by DeSmog shows. This may prove a barrier to taking specific steps to decarbonise their financing, as they have publicly promised.
Environmental investigators studied the current and past connections of board members of Bank of Montreal, RBC, CIBC, Scotiabank, and TD to the world’s most carbon-intensive industries, for example through other directorships, employment, or affiliations to lobby groups.
Canada stands out in the analysis as the region with most ‘climate-conflicted’ bank directors who currently have ties to these high-emitting sectors, compared to international peers. The research found that 62% of Canada’s bank directors have current connections to the high-carbon companies, compared to 44% for the US banks, 34% for Europe, and 31% for the UK.
When you include past and present connections, more than 82% of board members across Canada’s banks held positions in environmentally damaging companies.
DeSmog’s analysis showed 35% of directors were linked to the energy sector alone, revealing long careers spent in the oil, gas, and coal industries. These include links to high-carbon controversial oil extraction in the province of Alberta, which hosts the world’s third largest tar sands reserve, with a number of board members having held senior positions at oil sands producers Cenovus Energy and Suncor Energy. Research also revealed that one in 10 directors had worked in the steel, metal and mining industry, with at least four examples of connections to the coal industry.
Similarly, when looking at just current ties to the energy sector, Canadian bank directors are notably more climate-conflicted than their American and international competitors. Specifically these numbers yield 19% for Canada, 9% for Europe, 8% for the UK, and 7% for the US.
“It used to be normal and even expected for a bank to have directors with deep ties to the fossil fuel industry,” said Adam Scott with Shift Action. “But in this new net zero era, having all these ties to polluters on your board is only going to stand in the way of following through on promises to be greener. It’s a competitive disadvantage.”
Of the five banks, Scotiabank and TD had the highest proportion of directors with polluting ties, (93% and 92% ties respectively). Individuals with some of the deepest ties to fossil fuel companies included Bank of Montreal board member Lorraine Mitchelmore, who served as president for Shell Canada, worked for Petro-Canada, Chevron, BHP Billiton and is currently director of oil sands company Suncor Energy. CIBC board member Patrick D Daniel was president and CEO of Climate Action 100+ target company Enbridge, as well as previously sitting on the board of Cenovus Energy and Capital Power Corp.
Another notable individual, TD director Claude Mongeau, previously headed the Canadian National Railway Company, which transports 45 million tonnes of coal across the Americas every year. Mongeau currently serves on the board of Cenovus, as well as Canadian freight company Norfolk Southern Corporation.
The analysis also showed signs of far-reaching ties to think tanks and lobby groups, with at least 10 directors having served on the Business Council of Canada, a lobby group representing chief executives of Canada’s largest corporations. A taskforce for the group has previously recommended that the government “prioritise” infrastructure projects like oil and gas pipelines. There were also ties to powerful North American oil and gas lobby groups the American Petroleum Institute and the Canadian Association of Petroleum Producers.
DeSmog’s analysis also identified deep ties to other banks with a track record of investing in polluters. More than a quarter (26%) of directors work or have worked in banks, including JP Morgan, Citigroup and Goldman Sachs. Links to investment and holding groups with a history of investing in fossil fuels and other heavily polluting sectors accounted for a quarter (25%) of all board members.
NOTES FOR EDITORS
DeSmog is an investigative journalism platform dedicated to uncovering corporate wrongdoing on environmental issues. The UK team was established in 2014, with its investigations regularly being featured in mainstream media across the world. See www.desmog.co.uk.
UK Editor, DeSmog
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- DeSmog analysed the past and current ties of all 68 board members of Bank of Montreal, RBC, CIBC, Scotiabank, and TD to polluting industries. An affiliation was classified as ‘climate-conflicted’ if the sector in which the company predominantly participates is infamously polluting, including: fossil fuel energy exploration, production and generation; agriculture; aviation; road transport; mining; plastics and chemicals; forestry and paper production; construction; and shipping. In addition to this, an affiliation was classified as ‘climate conflicted’ if the company is included on the Climate Action 100+ list, Global Coal Exit list, Break Free From Plastic index, Bank Track’s Fossil Banks listings, DeSmog’s Climate Disinformation Database or scored poorly on InfluenceMap’s profile or – if an investment company – was found to have polluting projects in its portfolio.
- 13 out of the 68 current bank directors have a past or present connection to the energy sector, according to DeSmog’s analysis, including the coal, oil and gas industries.
- 18 out of the 68 current bank directors, or 26% of directors, have a past or present connection to banks known to support fossil fuel and other polluting industries, as defined by BankTrack and the Fossil Banks project.