Financial institutions are being urged by a new report to take leadership in advancing voluntary measures in efforts to break the connection between environmental crimes and finance.
The report, Breaking the Environmental Crimes-Finance Connection, presents Finance for Biodiversity’s (F4B’s) analysis and recommendations on how to break the connection between environmental crimes and finance.
Greening the supply chain
The report has been prepared as an invited contribution to the UK government-sponsored Global Resource Initiative, a multi-sectoral task force assigned to provide recommendations on greening the UK’s international supply chain footprint.
The paper’s primary focus is the potential for extending the use and positive impact of anti-money laundering (AML) rules in reducing environmental crimes.
In exploring this potential and its limitations, the report concludes that there is a need to go beyond the broader application of AML in breaking the current connection between legitimate financing and environmental crimes.
Financial community leadership
The report proposes a way forward, encouraging the financial community to take leadership in advancing voluntary measures paralleling anti-slavery and conflict diamond approaches.
It also suggests that attention to environmental crimes should not be treated by financial institutions as a reputational problem to be mitigated, but as an opportunity to de-risk and so build resiliency into their financing value chains and risk-adjusted returns.
The report concludes that policymakers and regulators, working with financial institutions, should see the opportunity to gain competitively from being the first movers in eradicating environmental crime from financial value chains.
F4B’s report, Breaking the Environmental Crimes-Finance Connection, can be found here.
Categories: Trade Based Financial crimes News
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