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Simon Zadek: Legitimate Investors Financing Environmental Crime

Simon Zadek: Legitimate Investors Financing Environmental Crime

Financial institutions often invest heavily in sectors that are dependent on nature, which can increase their profitability through environmental crimes. Although technically legal, the returns can be considered illegal if they are derived from criminal activity. Regulators should treat them accordingly.

AMSTERDAM You might not be aware that one of the most lucrative global criminal enterprises is AMSTERDAM. It is illegal fishing and logging, as well as waste trafficking and trades in wildlife. These attacks on the natural environment upon which we depend are reaping huge rewards for the financial sector.

It is difficult to quantify the environmental crimes that cause damage. These crimes destroy ecosystems and reduce natural assets and cause loss of livelihoods.

As a New reportFinance for Biodiversity (F4B), points out that such crimes can generate as much as $280 billion annually, decreasing tax revenues by around $30 billion per annum, with poorer, more environmentally-rich countries losing the most. Many times, financial institutions support the incentive by investing in enterprises that profit from such crimes unknowingly. These institutions are effectively laundering the proceeds of environmental crimes through the profits they make from these investments.

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