"UBS – Hands Off Our Oceans!"

Today, on the occasion of the UBS Annual General Meeting, an alliance of climate and human rights organizations is protesting in front of the venue, the Lucerne Exhibition Centre (Messe Luzern). The following organizations are participating: Klimastreik Zentralschweiz, Urgewald, Protect-VIP-Network, the collective BreakFree Schweiz and the Klima-Allianz Schweiz. 

At the AGM’s entrance, the activists unveiled an exhibition with pictures of the unique biodiversity of the Philippine strait “Verde Island Passage”. It is threatened by San Miguel Corporation’s plans for two new gas-fired power plants. New research shows that while other European financial institutions have cut ties with San Miguel, UBS is one of the world's largest investors in San Miguel's power plant division and ranks second among the company’s European financiers.

Experts from Urgewald and the Protect-VIP network will challenge the UBS leadership at the AGM. They are available for interviews.

Photos from the protest can be downloaded here:

https://www.flickr.com/photos/klima-allianz-ch/54442620769/in/album-72177720324972505

The San Miguel case is an example of UBS's backslide on climate and biodiversity. According to its latest sustainability report, UBS has not introduced strict divestment policies for coal or other fossil fuels. Clear guidelines against deforestation are also missing. It delayed previously introduced net-zero policies and scrapped its diversity, equality and inclusion goals.[1]

Quotes

Johanna Frühwald, Finance Campaigner at Urgewald, says: "While other European investors have dropped San Miguel, UBS is holding on to its dirty investments. This means that Swiss money props up a company that keeps tightening the fossil fuel grip on its own country. UBS invests exclusively in the group's bonds which means it has no strategic influence. Any semblance of the ‘critical investor’ who contributes to decarbonization is mere window-dressing."

Nicole Gisler, responsible for the financial center network at Klima-Allianz Schweiz, says: "UBS has neither a robust transition plan nor ambitious climate and biodiversity protection targets. Continuing to invest in the expansion of fossil energy sources not only fuels environmental and climate collapse; it also endangers long-term financial stability. The example UBS is setting shows: We urgently need strong, forward-looking regulation of the financial sector."

Father Edwin Gariguez, recipient of the prestigious Goldman Environmental Prize and board member of the Philippine NGO Center for Energy, Ecology, and Development (CEED), says: "Exceeding the 1.5°C global warming limit threatens the survival of the Filipino people and other climate-vulnerable communities across the world. Instead of committing to the country’s climate and energy ambitions, companies like San Miguel traps the Philippines into reliance on dirty, deadly, and costly fossil fuels at the expense of livelihood and biodiversity. This is what it is doing in the Verde Island Passage, our Amazon of the oceans. Our planet’s lifeline is under threat, and leading these attacks are the fossil fuel companies enabled by the deep pockets of international banks. We urge UBS to cut ties with this dirty business."

Background

UBS is one of the largest institutional investors in the Philippine San Miguel Group. The Group wants to significantly expand the capacity of its existing coal and gas-fired power plants in the country. This threatens the unique ecosystem of the Verde Island Passage (VIP) and also hinders the energy transition in the Philippines, which, according to a comprehensive study, has huge potential for the expansion of renewable energies.[2]

Investments are made through the following actively managed funds:

• UBS (Lux) Bond SICAV - Asian High Yield: $15.3 million [3]
• UBS (Lux) Bond Fund – Asia Flexible (USD): $1 million [4]

Other European financial institutions, such as the Austrian Erste Group and the Deutsche Bank subsidiary DWS have terminated their business with San Miguel for climate protection reasons, among others[5]. UBS, on the other hand, holds bonds issued by the San Miguel Global Power division in the amount of $16.3 million. This makes UBS second largest institutional investor in Europe and sixth worldwide in the San Miguel power division.

With its investment in San Miguel, UBS is supporting a company that, apart from some smaller renewable energy projects, plays a central role in fossil fuel expansion in the Philippines. San Miguel currently operates more than one in five gas-fired power plants in the country – 8 out of a total of 35. It is planning 8 more, either alone or with corporate partners. In terms of power generation capacity, the company is responsible for more than a third of the gas-fired power plant expansion in the Philippines. The plans for 2 new gas-fired power plants along the Verde Island Passage, a marine strait known for its unique marine biodiversity, are particularly concerning. The power plants there are to be operated with liquefied natural gas (LNG), which brings with itself the construction of numerous LNG terminals on the coast. 

LNG is a particularly climate-damaging fuel due to the high energy input for liquefaction and regasification as well as methane leaks along the transport routes. The LNG boom threatens to exacerbate climate overheating in a country that is already suffering from increasingly frequent severe storms and flooding. At the end of 2024, an unusually violent series of six cyclones devastated large parts of the country.[6] As a result of the storms, there were mass displacements and 174 people died.[7] This development earned the Philippines the sad top spot in the current World Risk Index. [8]

San Miguel's fossil fuel business is a burden on people and the environment alike. Recently, two oil tankers sank in Philippine waters, both chartered by a San Miguel subsidiary according to media reports. As a result, oil spills have polluted waters and coasts.[9]

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[1] UBS Sustainability Report 2024 - https://www.ubs.com/global/en/sustainability-impact/sustainability-reporting.html#tab-867172621 and https://www.tippinpoint.ch/artikel/77955/ubs_streicht_diversity_und_inclusion_aus_dem_geschaeftsbericht.html.

[2] Climate Analytics, A 1.5°C future is possible: getting fossil fuels out of the Philippine power sector (15.11.2023): https://climateanalytics.org/publications/a-15c-future-is-possible-getting-fossil-fuels-out-of-the-philippine-power-sector

[3] UBS Half-Year Report 2024 - https://documents.fww.info/fwwdok_Lqm5itl4nY.pdf

[4] UBS Half-Year Report 2024 - https://documents.fww.info/fwwdok_KgxZ2ndyZq.pdf

[5] Deutsche Bank subsidiary DWS stated in June 2023 that it had sold its San Miguel shares. In early 2024, Austrian Erste Bank told NGO representatives that it had sold its SMC shares.

[6] World Weather Attribution, Climate change supercharged late typhoon season in the Philippines, highlighting the need for resilience to consecutive events (December 12, 2024): https://www.worldweatherattribution.org/climate-change-supercharged-late-typhoon-season-in-the-philippines-highlighting-the-need-for-resilience-to-consecutive-events/

[7] ReliefWeb, WFP Philippines - 2024 Typhoon Season, Situation Report #6 (December 16, 2024): https://reliefweb.int/report/philippines/wfp-philippines-2024-typhoon-season-situation-report-6-16-december-2024

[8] World Risk Report 2024, p. 54: https://www.welthungerhilfe.de/fileadmin/pictures/publications/de/studies-analysis/weltrisikobericht-2024.pdf

[9] https://energytracker.asia/oil-spill-philippines/; https://www.rappler.com/philippines/san-miguel-shipping-subsidiary-owns-oil-mt-terranova/