In February, JPMorgan, the biggest bank in the U.S., organized an online event on “The Amazon rainforest and you,” promoting sustainable investment. Now, a new report says the bank reaped nearly $57 million through investments linked to forest destruction in the past five years.

These investments would make JPMorgan the top financier of deforestation in the U.S., EU, U.K. and China.

Between 2016 and 2020, JPMorgan and peers like the U.K.’s HSBC, Germany’s Deutsche Bank, France’s BNP Paribas, the Dutch Rabobank, and the Bank of China pumped billions into agribusiness companies that drive forest loss and profited from them.

Together, they made $1.74 billion from tainted investments, a Global Witness investigation has found.

“There is no more striking example of climate injustice than big financial institutions headquartered in banking centers like London, Paris and New York raking in eye-watering sums while they bankroll the destruction of the land, homes and livelihoods of communities who have safeguarded their forests for generations and are among the lowest greenhouse gas emitters in the world,” Shona Hawkes, senior global policy adviser on forests at Global Witness, said in a statement.

U.S.-based financial institutions alone netted $538 million by doing business with companies accused of clearing forests. In Europe, the worst offenders were in the Netherlands, France, Spain, Germany and Italy. Rabobank generated an estimated $76.2 million, while BNP Paribas made around $37 million from questionable agricultural investments.

When countries signed the Paris Agreement in 2015, campaigners hailed it as a decisive step in the battle against climate change.

Then-U.N. Secretary-General Ban Ki-moon highlighted the role of the private sector in the fight against climate change at the summit in the French capital, known as the 21^st Conference of Parties (COP). “How we do business today will determine if we can do business in the future,” Ban said.

That warning appears to have fallen on deaf ears. The Global Witness report shows that despite big promises, behind the scenes the biggest banks and investment firms did not cut off agribusiness companies that drive deforestation and are implicated in human rights violations.

Rather than accelerating decarbonization, these lenders are making the problem worse and profiting in the process, the money trail suggests. HSBC, the U.K.’s biggest bank, promised to stop backing companies implicated in deforestation in 2017. That didn’t stop it from channeling $6.85 billion into investments that could potentially destroy forests and earning $36.4 million from them.

Deforestation is a leading cause of climate change largely because forests, particularly tropical forests, are some of Earth’s biggest and most effective carbon sinks. As the U.K. gets set to host this year’s climate summit, COP26, in November, there is growing despondency that the goal of limiting global warming below 2° Celsius (3.6° Fahrenheit) is no longer within reach.

Many of these large agribusiness companies drive deforestation by trading in forest-risk commodities like beef, palm oil, wood pulp, soybeans, and rubber. Forested area larger than the size of the U.K. has been converted into agricultural plantations in the Amazon, Southeast Asia and Central Africa, according to experts. Most of this conversion happens illegally, and some of it amounts to land grabs, displacing and disempowering communities who act as forest guardians.

Global Witness roped in Dutch NGO Profundo to pore over 70,000 share, bond, credit, and underwriting deals to estimate the share of the banks’ profits that can be linked to deforestation for the report. They zeroed in on agreements signed with 20 of the “most harmful” firms with a poor track record of protecting forests.

When financial institutions fund these activities, their earnings are mainly in the form of interest on their investments, dividends and fees. It is unclear if banks are only failing to do their due diligence or funding companies with full knowledge of their ecological and social footprint.

Earlier this year, lenders came together to form the U.N.-backed Net-Zero Banking Alliance, with 60 banks agreeing to align their portfolios with net-zero emissions by 2050. All the leading banks named in the Global Witness report, except the Bank of China, are part of this coalition.

But the Global Witness findings suggest that voluntary pledges do not translate into real change. “Unfortunately, we are expecting to see more of the same false solutions on deforestation touted at this crucial conference,” the report authors said about COP26.

Currently, investors are not legally barred from lending to bad actors. “We need government regulation to create a legally binding disincentive to bankrolling forest destruction and human rights abuses,” the report says.

This accountability could be expanded to making reparations for poor investment choices in the past. In 2020, Australia-based bank ANZ promised to give $40 million, its profits from a loan to a sugar company, to victims of land-grabbing in Cambodia.

In responses shared with Global Witness, BNP Paribas, HSBC and Rabobank denied that their investments fueled deforestation. Deutsche Bank and JPMorgan declined Global Witness’s request for a comment and had not responded to Mongabay’s questions by the time this article was published.

Banner image: Young activists and their allies led a climate strike in San Rafael, California, to demand action from banks on climate change in 2019. Image by Fabrice Florin via Flickr (CC BY-SA 2.0).