Westpac chief executive Gail Kelly

23 January 2014 — Westpac has been named the most sustainable company in the world in the 2014 Global 100 Index, a ranking of the top sustainable companies announced today at the World Economic Forum in Davos, Switzerland. Concerns have been raised, however, that the organisation continues to lend to coal and gas projects.

Westpac last year ranked 10th, and has moved up the listing with some strong sustainability achievements for 2013, including:

  • a commitment to make up to $2 billion available for lending and investment in social and affordable housing and services by 2017
  • a commitment of $6 billion for lending and investment in cleantech and environmental services by 2017
  • 42 per cent of leadership roles being held by women
  • 423 weeks’ worth of time sharing skills with Indigenous organisations through Jawun Indigenous Corporate Partnerships secondments

The key performance indicators used by the index’s creators (Canadian media and investment research company Corporate Knights) to rank companies were:

  • energy productivity
  • water productivity
  • waste productivity
  • innovation capacity
  • percentage tax paid
  • CEO to average worker pay
  • pension fund status
  • safety performance
  • employee turnover
  • leadership diversity
  • clean capitalism pay link
  • carbon productivity

Other companies making the top 100 included Stockland (the only Australian real estate company), ANZ, Commonwealth Bank and Wesfarmers.

“I am delighted that Westpac’s sustainability performance has been rated so highly on the global stage,” said Westpac chief executive Gail Kelly from Davos. “It is wonderful recognition of the work of our people to help create a sustainable future and deliver long term value for our customers, employees, shareholders and the community.”

Westpac routinely makes the top of sustainability listings, though has been criticised in the past for continuing to lend to coal and gas projects.

According to Market Forces, which pressures organisations to stop financing environmentally damaging activities, Westpac has lent over $1 billion to coal and gas export ports along the East Coast of Australia since 2008.

Paul Smith, general manager, strategy and communications for Australian Ethical Super, which invests in Westpac, said while lending to these sorts of projects was one aspect of Westpac that was unfortunate, the positive contributions Westpac had made “massively outweighed the negative”.

He said less than one per cent of the money Westpac lent went to mining, and that the vast majority went to causes AE had deemed as “positive”, including well over 70 per cent of loans to individuals and small business, and the $6 billion in cleantech mentioned above.

Mr Smith said that AE’s investment in Westpac was continually being reviewed, however, and that because such a small percentage of money was lent to these environmentally dubious projects, it would be a relatively easy move for Westpac to stop its lending, a move it would welcome.

Mr Smith also noted that there was no such thing as an “ethically pure” investment, with even renewables having ethical downsides.

For more see https://www.australianethical.com.au/news/why-we-invest-westpac

See the full list of companies in the top 100.

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