Ms Karol Balfe:

Action Aid Ireland is a member of the Stop Climate Chaos coalition, like many of the other organisations before the committee today. We are very pleased to have this opportunity to engage with the committee just as COP is about to commence in Dubai.

The impact of the climate crisis has been well covered by many of my colleagues but I want to touch upon the gendered impact of the climate crisis. According to UN Women, women and children are 14 times more likely to die from a climate disaster than men, 80% of those displaced in climate disasters are women, and the greater the inequality, the greater the disparity between men’s and women's chances of survival. Therefore, it is a highly gendered issue that is causing terror and grief, as well as compounding poverty and inequality.

I will pick up on some of the points around financing and the crucial issue that most of the world's money is flowing to the causes of the climate crisis rather than the solutions. The committee will be well aware that fossil fuels are by far the largest contributor to climate change and they account for 75% of global greenhouse gas emissions. What we know in Ireland, although it is less known globally, is the role of industrialised agriculture and its contribution to the climate crisis. This industrialised agriculture, which is controlled and marketed by giant agribusiness corporations, is responsible for the bulk of emissions in that sector and is the second-largest contributor to global greenhouse gas emissions.

Financing provided for fossil fuels and industrial agriculture in the global south is likely to dwarf the finance provided by international banks for renewable energy and agro-ecology, which is a sustainable form of farming that many people living in poverty rely on to survive. Research conducted by Action Aid globally shows that only 7% of the financing provided by major international banks has gone to renewable energy in the seven years since the Paris Agreement. To put it simply, the climate emergency has a cash flow problem, and the figures are staggering.

In the seven years since the Paris Agreement was signed, ActionAid research with the company Profundo found funding to the fossil fuel industry in the global south reached an estimated $3.2 trillion and bank financing provided to harmful, large-scale agribusiness amounted to $370 billion over the same period. Since the Paris Agreement, banks have provided 20 times more financing to fossil fuels and agricultural activities in the global south than global north governments have provided as climate financing to those countries on the very front line of the climate crisis.

Unfortunately, Ireland has a very uncomfortable role in this. Profundo analysed financial institutions headquartered and registered in Ireland, looking at both agribusiness and fossil fuel industries. As the committee is well aware, more than 1,200 multinational companies have established themselves in Ireland, including 20 of the top 25 financial services. Those investment managers registered $6.2 billion in bonds and shares attributable to fossil fuels and agribusiness in the global south. This is not an accident. This is the design of the Irish economy, where those companies are headquartered and it is no surprise we see this scale of funding. The top six investments are all oil and gas companies, including Shell, Exxon and Chevron, and are funded from some of the top US financial institutions like BlackRock, State Street and Marsh McLennan. This comes in the context of Ireland’s tax regime, which has been widely criticised by various organisations represented here, but also by the UN Committee on the Rights of the Child, which said Irish tax policies are undermining the ability of other countries to raise revenue to address poverty experienced by children in those countries and it is now clear given these figures that this tax regime is also having a very harmful impact on the climate crisis in the global south.

It is somewhat of a surprise that Ireland has the Fossil Fuel Divestment Act, which would, on the face of it, make one think these types of investment should not happen. We reviewed the Act in the research. I state clearly this was landmark legislation in 2018, with Ireland being one of the first countries to bring in such legislation and, therefore, a global pioneer. However, as the scale of the climate crisis has increased, so too must our actions. In our review of the Act, we found a number of shortcomings. It only looks at undertakings, that is, new explorations. It excludes indirect investments, meaning hedge funds and derivatives are excluded from the Act. It does not deal with harmful agribusiness at all. It also has no review clause built into it. There are, therefore, a number of areas where this could be strengthened. The research we funded found some investment by the strategic investment fund in both fossil fuels and agribusiness, but given the limited scope of the Act both are probably perfectly legal, thereby highlighting the issues with it. It is really important to note the $6.2 billion is not in any way dealt with in the Act, so that major figure being channelled through Ireland is not being included. This is simply unacceptable in a time of unprecedented climate breakdown. Ireland’s strong overseas development work, our commitments in climate financing - though short of what they should be - and our work on loss and damage absolutely need to be coherent across all government policy and this is an issue the Government must address.