HSBC, Credit Suisse Make A Mockery of Their Environmental Policy (posted: 2007-3-01)

HSBC, Credit Suisse Make A Mockery of Their Environmental Policy

Major news media in Hong Kong reported[1] that two of the world�fs largest European banks, Credit Suisse and HSBC are to be arranging a USD 250 million share placement on the Hong Kong market in early March 2007 on behalf of the Samling Group, one of Malaysia�fs largest forestry companies.? The Samling Group has faced almost constant attack from pressure groups in Malaysia and internationally for the last thirty years over its allegedly destructive logging practices and corrupt business methods.? The Group has its origins in northeast Sarawak where it been responsible for the logging of most of the primary forest in the region.? It has since moved on to logging of primary forests in Cambodia, Guyana and through subsidiaries, in Papua New Guinea.? Only a small portion of its forestry activities involve managed plantation forests, through a recently acquired operation in New Zealand.[2]? The involvement of these two banks in helping Samling to raise funds appears to be in direct conflict of their respective pledges on supporting sustainable forestry.?

HSBC won the Financial Time�fs Sustainable Bank of the Year award in 2006 and was noted for its �gForest Land and Forest Products Sector Guideline (2004)�h.[3]? In this, HSBC states that it will not provide financial services �gin respect of commercial logging operations in primary moist forest�h.? Clearly Samling�fs logging operations fall almost entirely in this category, which would seem to make HSBC in default of its own policy.? HSBC tempers its policy by stating that it will work with forestry companies which, although they are not in compliance with HSBC stated policies at present, are working towards these goals and will comply by 2009.? It remains very unclear how Samling can wean itself from logging primary rainforests within two years.? Further, the only tropical forest FSC (Forest Stewardship Council) certificate Samling did have (for a concession in Guyana) was reportedly withdrawn earlier this year due to �gsystematic major non-conformities�h.? Relying almost completely on natural tropical forests for its timber and having its only tropical forest FSC certificate yanked does not demonstrate commitment by Samling to adhere to HSBC�fs pledges.

What Can you Do?

Send an e-mail of protest to HSBC and Credit Suisse demanding they withdraw from the Samling share offering.??

HSBC Contacts: http://www.hsbc.com/hsbc/investor_centre/shareholder-contacts

Credit Suisse Contacts: http://www.credit-suisse.com/investors/en/contacts_investor.html

Contact the provider of your pension fund, mutual or investment funds and demand that they do NOT buy into the Samling share offering.

Appendix: A sample of press and other reports of Samling are provided.

January 2007 - FSC Withdrawn The FSC (Forest Stewardship Council), the world�fs leading body providing certificates of well managed forests, has suspended Samling�fs only FSC certificate relating to its logging operations in Guyana.? The reason was cited as �gsystematic major non-conformities�h.? Some leading buyers in the West, such as B&Q, specific suppliers must demonstrate FSC in their wood as a precursor to buying.[4]

late 1980s to present ? Destruction of Northeast Sarawak�fs Forests: The Samling Group and its subsidiary companies have fought a highly publicized battle with indigenous groups in northeast Sarawak over the last quarter century.? In particular, the Penan tribe claim Samling has systematically destroyed their ancestral homelands and engaged in corrupt and sometimes violent practices in their logging operations in the region.? Logging rates in Sarawak in the 1990s were among the world�fs highest and declared to be unsustainable by the ITTO (International Tropical Timber Organization), a trade body.? Samling remains one of the three leading operators in Sarawak.[5][6]

2002 ? Accused of Illegal Logging in PNG: A Samling group company, Concord Pacific fought a highly publcised battle with Greenpeace and local forest dwellers in Papua New Guinea over what the pressure group claims was Concord�fs blatant disregard of legal practices in forestry management in the country.? [7]