In a shocking revelation, a recent report by the Environmental Investigation Authority (EIA) has uncovered that several major global banking giants are investing in companies producing traditional Chinese medicines (TCM) containing parts of endangered species such as leopards and pangolins. The report identifies 62 banks and financial institutions, including prominent names like HSBC, Goldman Sachs, and Deutsche Bank, that are investing in three pharmaceutical groups responsible for manufacturing nine products known to contain leopard or pangolin parts.
Leopards and pangolins are classified as threatened species, with their numbers declining rapidly. They are both listed on the CITES (Convention on International Trade in Endangered Species of Wild Fauna and Flora) treaty, which prohibits international commercial trade in them and their parts. This treaty aims to protect these species and prevent their extinction in the wild. However, the investment in TCM companies using these endangered species contradicts these conservation efforts.
The three pharmaceutical companies mentioned in the report are Tong Ren Tang group, Tianjin Pharmaceutical group, and Jilin Aodong Pharmaceutical Group. While not all the listed banks invest in all three companies, they are involved in at least one of them. The use of leopard bone in TCM is intended as a substitute for tiger bone, believed to strengthen bones and sinews, provide pain relief, and alleviate wind-related ailments. Pangolin scales are claimed to aid blood circulation, lactation, and relieve rheumatic pain, although these claims lack scientific evidence.
Following the publication of the EIA report, Avinash Basker, the EIA Legal & Policy Specialist, called on the Chinese government to enforce the CITES recommendations and prohibit the use of these endangered animal parts for commercial purposes within their domestic markets. Basker emphasized that the industrial-scale utilization of threatened animals in traditional medicine products only pushes these species closer to extinction. He also condemned the major banks and financial institutions for endorsing this damaging exploitation, urging them to divest from TCM manufacturers utilizing threatened species.
In response to the report, HSBC clarified that they are not a direct investor and do not have direct exposure to these companies. Instead, their investments in TCM companies are limited to passive or ‘tracker’ funds. Deutsche Bank directed attention to DWS, a separate listed entity that handles asset management for the bank, stating that actively managed DWS funds are not invested in any of the three issuers mentioned in the report. Legal & General Investment Management acknowledged the impact of natural resource use and exploitation on nature loss, highlighting their efforts to develop a ‘nature framework’ to address these issues.
The EIA could not ascertain the source of leopard or pangolin derivatives used in these TCM products. The lack of transparency surrounding the supply chain raises concerns about potentially illegal and unsustainable sourcing practices. The EIA report highlights the need for stricter regulations and greater accountability in the TCM industry, particularly regarding the use of endangered species.
This news has significant implications for both the finance and conservation sectors. The investment choices of major banks and financial institutions play a role in shaping industries and economies worldwide. By investing in companies that contribute to the exploitation of threatened wildlife for TCM, these institutions indirectly perpetuate the demand for endangered animal parts. This not only threatens the survival of already vulnerable species but also tarnishes the global reputation of TCM.
Furthermore, this news underscores the importance of strengthening regulations and enforcement mechanisms to combat the illegal wildlife trade. Governments and international organizations must collaborate to ensure the protection of endangered species and the preservation of biodiversity. Efforts should focus on fostering sustainable alternatives for traditional medicinal practices and promoting scientific research to validate the efficacy of TCM ingredients.
As consumers and investors, we have a responsibility to make informed choices. Supporting sustainable practices and ethical investments can contribute to the conservation of wildlife and habitats. By creating awareness and demanding transparency from financial institutions and TCM manufacturers, we can foster positive change and protect endangered species from exploitation.
In conclusion, the revelation of global banking giants investing in TCM companies utilizing leopard and pangolin parts highlights the need for greater scrutiny and accountability in the finance and conservation sectors. This news serves as a wake-up call to the potential consequences of our investment choices and the urgency of addressing the illegal wildlife trade. Only through collective efforts can we ensure the survival of endangered species and the preservation of our natural world.
