Conservation group links 34 NAB-held mortgages to deforestation
NAB, Australia’s largest business bank, is facing mounting pressure from investors over its exposure to deforestation through its agricultural lending, following an investigation by the Australian Conservation Foundation (ACF).
As reported by The Australian Financial Review, more than 100 shareholders, coordinated by ACF, are backing a resolution that will be put to NAB’s annual general meeting on 12 December. It marks the first time a major Australian bank will be challenged at an AGM on nature-related risk disclosures.
The resolution, which will be co-filed by institutional investors including Melior Investment Management, SIX Invest and Australian Ethical, calls on NAB to disclose the extent of its lending to agribusinesses linked to deforestation and to implement a strategy to end financing of such activities in line with global environmental standards.
“It’s not good business for any bank to be funding clients who rely on deforestation to make a profit,” Amanda Richman, ethical stewardship lead at Australian Ethical, told AFR. “These same clients face heightened financial risk associated with the degradation of soil quality, reduced long-term agricultural capacity and potentially reduced market access.”
Inside the ACF report
The shareholder activism follows the release of the ACF’s ‘Financed Deforestation’ report, which found that NAB was the most exposed of any Australian bank to deforestation via its agribusiness loan book.
Using satellite imagery, drone footage, and property title data, ACF documented 100 cases of land clearing between July 2023 and July 2024 – 34 of which were linked to NAB-held mortgages, double that of any other bank.
In nine of those cases, deforestation occurred during or shortly after mortgage agreements were issued.
The investigation also identified 42 cases likely to have impacted Matters of National Environmental Significance, such as threatened species habitats, without federal government approval – potentially breaching the Environment Protection and Biodiversity Conservation (EPBC) Act.
In one case, a property under mortgage by NAB was found to have undergone 366 hectares of deforestation between August 2022 and August 2024 in the Murray Darling Depression bioregion of southwest New South Wales.
This area is part of the Southern NSW Mallee Key Biodiversity Area, recognised globally for its ecological importance.
According to the ACF, the cleared land likely included habitat for the nationally protected Mallee Bird Ecological Community and threatened species such as the Corben’s Long-eared bat, south-eastern hooded robin, southern whiteface, pink cockatoos and malleefowl.
ANZ (including Suncorp Bank) was found to have the second highest number of mortgages linked to deforestation, with Rabobank, Commonwealth Bank and Westpac equally tied at third.
The ACF contended that banks are “massively underreporting” financed emissions due to a failure to account for land-use change, which is a major contributor to carbon dioxide emissions.
According to the report, more forest was cleared for beef in Queensland in recent years than was destroyed for palm oil in the whole of Indonesia.
The ACF’s report calls for:
- Banks to adopt a no-deforestation lending policy
- Increased geospatial monitoring of loan portfolios
- Better engagement with agricultural clients on regenerative practices, and
- Support for stronger federal environmental law reform.
In comments provided to MPA on the matter, a NAB spokesperson said: “As Australia’s largest lender to agriculture, we understand deforestation is a complex challenge that needs collaboration across government, industry, and landholders.
“We’re already acting on many of the recommendations made in the 2025 ACF report and we continue to revise our approach to manage deforestation risk while supporting our customers.
“This includes working closely with key stakeholders to understand a broader set of perspectives, updating our land valuation processes and investing in geospatial tools to better understand land use changes and the risks they pose.”
MPA was also directed to NAB’s 2024 annual report, which stated: “If we become aware customers are engaged in, or alleged to be involved in, illegal land clearing, the group reviews the matter and takes action, as appropriate, in line with risk appetite and NAB's ESG, Credit and Financial Crime policies and processes.”
It is expected that NAB will make further comments on this topic in its next climate report, scheduled for release in annual disclosures on 6 November.
What is agri-lending?
Agri-lending refers to the financial products and services that banks and other lenders provide to agricultural businesses. These loans are typically secured against farmland or rural properties and are used to fund activities such as purchasing livestock, upgrading equipment, expanding operations, or managing seasonal cash flow.
The resolution from NAB shareholders is expected to be filed today ahead of the 12 December AGM.
