Soon there will be something else to beat up the banks about. Politicians will have more than just interest rate rises, billion-dollar profits and CEO salaries to get upset about. Banking and biodiversity will be the new battleground.
The federal Department of Sustainability, Environment, Water, Population and Communities (that's its full title) has started consulting with banks about ''the role the financial sector may play in conserving Australia's biodiversity''.
The department wants to know how ''behaviours in ... the financial sector could potentially be influenced in a way that would induce a shift towards economic activity that is biodiversity-benign or has reduced adverse consequences for biodiversity''.
It's no surprise the Environment Department wants to get its hands on the banks. There's no part of the Canberra public service that as a matter of culture and practice is more hostile to economic development than the Environment Department.
The provision of capital is essential to economic development. If there's no capital there's no development. Up until now the department has only been able to regulate the specific projects of developers that employ the capital provided by the banks.
But regulating the banks themselves could potentially stop entire categories of projects, not just particular projects, as happens now. And the sort of projects that have the most impact on biodiversity are the sort of projects the country is more in need of — namely infrastructure and specifically roads and ports.
There's a precedent for what the Environment Department is trying to do. Ten years ago, as a result of pressure from international environment groups, a number of banks including ABN Amro, Barclays, and Citigroup developed the ''Equator Principles'', which require financial institutions to identify and report on the environmental and social consequences of their lending.
The Equator Principles are voluntary. Whether our own Environment Department will be satisfied with merely a voluntary regime remains to be seen.
The background to what's now happening is that in 2010 the commonwealth government and all state governments agreed to a policy document, Australia's Biodiversity Conservative Strategy 2010-30. A key priority of the strategy is to ''mainstream'' biodiversity.
In its consultations with the banks, the department is claiming that ''mainstreaming involves integrating biodiversity into decision making so that it is part of every relevant transaction, cost and decision''. If they mean what they say, and there's no reason to doubt them, officials from the Environment Department could potentially end up with more power over the banks than the Treasurer. The government won't need the excuse of climate change to regulate business any more. Biodiversity will become the new climate change.
The actual definition of ''biodiversity'' itself is similarly vague.
''Biodiversity is the variability among living organisms from all sources ...''
Stepping on an ant affects variability among living organisms. The strategy acknowledges that maintaining biodiversity could conflict with economic growth, but there's no discussion on how to manage the trade-offs. Likewise there's no analysis of how much biodiversity is enough. The strategy simply demands there be more biodiversity and more government spending on biodiversity. It's just assumed that the more biodiversity we have, the better, regardless of the cost.
The strategy aims, by 2015, to increase the area of land and sea under environmental management by 600,000 square kilometres. That's roughly equivalent to an area one-tenth of Australia's land mass. Stopping agricultural and industrial development across a 10th of Australia might be good for biodiversity, but it won't do much for economic growth.
What's perhaps more worrying about the strategy is that it endorses the so-called ''precautionary principle''. The principle is ''that lack of full scientific certainty should not be used as a reason for postponing a measure to prevent degradation of the environment where there are threats of serious or irreversible environmental damage''.
The precautionary principle is notorious. It was invented by environmental advocates as a way of avoiding having to rely on evidence to substantiate their claims.
The precautionary principle replaces evidence with opinion. And the precautionary principle and spiritual inspiration is what the Environment Department will be armed with as it takes on the banks.
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