Open Letter to E. Sun Bank Divestment
July 3th, 2019
Due to climate change and air pollution, E. Sun Commercial Bank announced on July 1st that it will stop financing any new coal power plant projects as well as ending its current financial ties with existing contracts once they are due. This new policy will impact all of its branches in Taiwan along with its 9 foreign countries services in a total of 28 locations. E. Sun joined the global movement to create a sustainable world through social and environmental means. For this, 350 Taiwan expresses our support and acknowledgment.
E-Sun is the first financial institution to announce divestment in Taiwan. This made them the first bank to divest in Taiwan and also the first organization to divest in the country. This policy echoes the global demand for climate action; making E. Sun an aspirational figure in climate action in the Asian financial sector. In fact, since 2012, the global divestment amount has surpassed 8.77 trillion US dollars. Over 1000 institutions participated, including religious groups, foundations, educational institutions, government and more.
Though there are more than 100 financial institutions divested, it was only the two recent years that leading Asian financial institutions starting to change their policies, beginning to divest. These financial institutions are:
- Mitsubishi UFJ Financial Group
- Sumitomo Mitsui Banking Corporation
- Mizuho Financial Group
- OCBC Bank
- DBS Bank
- United Overseas Bank
Worth mentioning, this act is more than an action for the environment but also a long term financial planning. Numerous researches pointed out that fossil fuel is facing a future of rising and unstable cost. This soon will reduce its financial value and even become stranded assets. In addition, global discussions at the G20 and the World Economy Forum are aiming to regulate fossil fuels through carbon pricing measures, such as stopping fossil fuel subsidies to foster the energy transition. All these are generating threats for investing more in coal firing power plants.
350 Taiwan and 350.org have long been advocating green finance and energy transition. We understand the difficulty to divest, and it requires long-term vision, a strong commitment to human ethics, and careful planning for finances. However, in the face of the climate crisis, making the decision to divest is the true execution of the Equator Principles, Principles for Responsible Investment (PRI), and Environmental, Social and Governance (ESG). We hereby call upon all the financial institutions and government funds to join the divestment actions just like E. Sun, practicing green finance to bring Taiwan, the world and the next generation a better and more sustainable future.