Campaigns to stop ANZ Bank financing the pulp mill


Since 1995, ANZ has provided crucial financial services to Gunns but after concerted public pressure, has refused to play the role of lead banker and finance Gunns' proposed pulp mill in the Tamar Valley.

See pulp finance for a list of the main risks of Gunns pulp mill to investors, businesses, the community and government.

TAP and the Women for Change Alliance have collected the names of around 3000 concerned Australians who support the call for ANZ not to fund Gunns' proposed pulp mill. Click on the cover letter sent to Mr Mike Smith of ANZ. Most names are on hard copy. The campaign to collect signatures is now closed and we sincerely thank the thousands of Australian people who supported the call.

The two letter writing campaigns targeting the ANZ gave concerned Australians an opportunity to add their voice to calls for the ANZ not to fund the pulp mill.



Cover letter to Mr Mike Smith supported by 3000 concerned Australian citizens

Mr. Mike Smith
Chief Executive Officer ANZ Bank Limited
100 Queen Street, Melbourne Victoria 3000

Re: ANZ funding Gunns proposed pulp mill.

Dear Mr. Smith,

We are writing on behalf of the many Australians whose signatures are enclosed. They represent around 3000 signatures from Australian citizens which have been collated through two community organisations Tasmanians Against the Pulp mill ‘TAP’ and Women for Change Alliance ‘WFCA’.

The signatures have come from many geographic locations and many are ANZ customers.

Now more than ever, Australians are aware of the immense problems posed by climate change and the role that the cessation of native forest logging has in mitigating global emissions. A pre election poll found 76% of Australians do not want the pulp mill and the ratification of Kyoto helped secure a win for the Labor party in election 2007.

Corporates and politicians will increasingly be held to account for the role they play in creating a sustainable future. As ANZ is keen to portray itself as a bank that subscribes to good corporate governance principles and sustainability issues, it can not expect to be taken seriously if it funds the Gunns’ pulp mill.

Whilst the issues surrounding Gunns are plentiful, one important point must be highlighted. Funding Gunns’ proposed mill will associate ANZ’s name with deforestation of mature native forests, at a time when the vital role of deforestation in contributing to worsening climate change is recognised under the Kyoto protocol.
Gunns’ pulp mill will be one of the largest in the world and will rely for 80% of feedstock from Tasmania’s mature native forests. These are a one off resource and a substantial carbon store.

Associating the bank with promoting deforestation and climate change is a serious public relations risk for ANZ.

Gunns claim that the mill feedstock will be increasingly sought from plantations is fallacious. The water shortages being experienced in it’s plantations mean the feedstock growth rates are not meeting expectations. In addition, projected declines in rainfall from climate change will exacerbate shortfalls from its existing and future plantations and put increasing unsustainable pressure on Tasmania’s forests.

Australia can ill afford to maintain this level of deforestation that Gunns will pursue.

In the same way as politicians have lost their seats due to poor environmental and climate change policies, corporates face the same customer backlash, should they be perceived as not meeting their environmental claims. The risk to ANZ’s reputation over funding Gunns’ pulp mill is immense.

Australian’s recognise that we can and should take the lead in offering climate change solutions to the world, they also feel that corporates should take the lead in sustainable business practice. ANZ has and is working hard to achieve and manage this image, which will be wiped out by funding the pulp mill.

We look forward to hearing from you and of course we are happy to meet and discuss any issues that are relevant to your position on Gunns.

Kind Regards

Danielle Ecuyer, ex investment banker, founder and spokesperson of WFCA and 2007 Independent Candidate in Wentworth.
MO: 0408 284 226

Bob McMahon, spokesperson for Tasmanians against the pulp mill (TAP)
MO: 0448 547 290


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Support the public letter to ANZ (now closed)

How to gather names of friends and supporters
1. Download a copy of the 'Letter to ANZ to not fund pulp mill v2.pdf' and 'Form for names in support of ANZ letter v2.pdf' from below.


2. Simply present a copy of the letter to friends and colleagues and ask them to add their name to the names form. Please explain that their name will join those of thousands of concerned Australians on this website.

3. Post your completed names form to:
"ANZ public letter"
c/- PO Box 1207
Gravelly Beach, TAS 7276



Public letter to Mr Mike Smith, ANZ

Mr. Mike Smith, Chief Executive Officer ANZ Bank Limited
100 Queen Street, Melbourne, Victoria 3000


Dear Mr. Smith,

Congratulations on your appointment as CEO of ANZ Bank. We are writing to express our concern that ANZ, as the banker to Gunns Ltd, may consider raising finance for the proposed pulp mill in the Tamar Valley in northern Tasmania.

It is our contention that the proposed pulp mill, as it now stands, fails to meet the admirable standards and principles set by the ANZ. Here are the reasons why we consider the proposed plant to be too high risk for ANZ. The potential costs of the mill well exceed any possible future financial benefits.

1. Potential breach of the Equator Principles

In your capacity at HSBC you commented “No company can succeed in a failed world-it’s in the interests of all companies to ensure that wealth creation is sustainable”; and “We (HSBC) have also developed guidelines for investing and lending to certain business sectors to ensure we operate to international social and environmental standards and follow our commitment to the Equator Principles.”

Your historical commitment to the Principles and the fact that ANZ became a signatory in April 2007, means that the potential funding of the proposed pulp mill would place ANZ in breach of its commitment to best practice lending standards.

2. Reputational risks

ANZ’s reputation is severely at risk. Perceived lack of adherence to the Principles and the abandonment of Tasmanian’s statutory planning and assessment process, in favour of a political fast tracking approval process has triggered widespread community disapproval. This has consistently been reflected in the opinion polls.

The general lack of transparency, infamy and ever increasing catalogue of controversies surrounding this project have been widespread. It is likely to become a project of community ill-will, legal challenges and arguments about breaches of permit conditions for decades to come. Many Tasmanian citizens and otherwise moderate public figures are calling for a Royal Commission.

Does ANZ really want to be involved in such a controversial and maligned investment? Implication by association can affect investor perceptions and share price performance.

3. Financial risks

The Tasmanian Roundtable for Sustainable Industries Project (Major contributor-Associate Professor Graeme Wells from UTAS) is the first cost benefit analysis conducted on the proposed mill (the report conducted by the Tasmanian Government, resulting in state project approval was a “Benefits” only study). The Roundtable concluded that “if you add up the risks to health and other industries plus the costs and subsidies the total cost could be $3.3 billion to the Tasmanian economy”. The opportunity costs of hundreds of millions of dollars in tax payer subsidies underpinning this project, such as secret deals on access to tax payer owned native forest, has yet to be considered in any detailed analysis. Poor public perception and national attention is set to change these subsidies, posing a clear risk to the future profitability to the proposed mill.

In the context of recent pulp mill closures in Canada (where some mills are only 15 years old), the report also analyses the vulnerability of the mill to exchange rate, costs and commodity prices and competition from Asia and South America, particularly in the absence of favourable subsidies and low stumpage feedstock prices.

Surely ANZ, as the proposed major lender would be extremely concerned by the financial risks of a project of this size and the risks it poses to it’s loan book, bad debts and profits. The $2 billion investment is about the same as Gunn’s current market capitalisation.

4. Carbon risks

Conservative estimates show the proposed mill will generate 10 million tonnes of CO2 per annum. The application of a cost of carbon places this mill at great risk of decreasing profits as the costs of carbon are internalised. At a conservative $20 cost on carbon, the mill’s EBITDA could be wiped out by the $200m cost of carbon.

Contrary to Gunns’ claims, we believe the use of wet native forest for pulp production is a net CO2 emitter. The forests alone are estimated to hold 400 million tonnes of carbon and there is strong argument to support that native forests will be more valuable as carbon offsets than pulp feedstock.

5. Litigation risks

The proposed mill’s effluent and emissions, such as foul odours and chlorophenols in the Tamar valley have been strongly questioned . The mill is at risk of litigation due to the pollution impacts and from major odour emissions during plant shutdowns.

In summary, the proposed pulp mill is an extremely high risk project on all counts. The mill’s economic model is not sustainable once the risks and costs are factored into potential outcomes, and hence does not offer any clear net financial benefits to the economy or residents of Tasmania. In fact it greatly risks (even through perception) the existence of other flourishing, ‘cleaner and greener’ industries such as wine and tourism.

Deforestation generates around 20% of global CO2 emissions each year. How can ANZ as a signatory to The Equator Principles justify lending to such an unsustainable project?

Mr. Smith, as concerned Australian citizens, Tasmanian residents and ANZ customers we strongly urge you not to assist in financing this mill. Many ANZ customers could have good reason to reconsider their banking arrangements, if ANZ finances the proposed mill.

We look forward to hearing from you.

Yours Sincerely,

Rick and Anna Pilkington, Local Residents Tamar Valley
Danielle Ecuyer, President WFCA Sydney Resident and ANZ Customer
Robert McMahon, TAP Spokesperson
Peter Whish-Wilson, Resident and small business owner Tamar valley.

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BankTrack’s ANZ campaign to stop financing Gunns.

BankTrack, a network of 23 international civil society organizations tracking private finance, along with The Wilderness Society and Rainforest Action Network, have been campaigning to stop financing of Gunns' pulp mill.

Mr Smith has responsibility for ANZ’s environmental and social impacts and can decide to pull his bank from financing both Gunns Ltd and the mill. Since 1995 ANZ has provided crucial financial services to Gunns. ANZ provides the company with secured bank loans with a current debt thought to be more than AU$300 million (US$250 million). Relative to the pulp mill ANZ is understood to have advised on the project and is also the lead arranger. Further, Gunns management states that ANZ is certain to provide project finance, underwrite the mill, and that the bank has already arranged export credit deals from Europe.

ANZ is signatory to the Equator Principles which are environmental and social principles that the bank promises to apply to Gunns' new project. Concerns regarding the environmental, health and economic impacts of the proposed mill worry local residents, whilst procedural irregularities and major gaps in the environmental assessment documentation create an enormous risk that the ANZ will fail to live up to its environmental commitments, including the Equator Principles.

Mr Smith is now being asked to bring ANZ in line with their environmental and social commitments. David Barnden from BankTrack comments “Mr Smith has a wonderful opportunity to show ANZ’s customers, the Australian public, and the world true leadership and commitment to uphold banking industry standards.”

Without ANZ's help, Gunns' pulp mill project will likely fail.

You can help the campaign by taking the pledge to become involved. Go to the Wilderness Society's website

Paul Oosting The Wilderness Society, ph. + 613 6224 1550, email

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Form for names in support of ANZ letter v2.pdf8.93 KB
Letter to ANZ to not fund pulp mill v2.pdf18.77 KB