In the context of lending money to a corporation, environmental issues represent another aspect of credit risk. These issues, because of their nature, represent the potential for large unforeseen expenditures if they are not known or acknowledged and are not being proactively managed. Lenders, other investors and their advisors, are becoming increasingly aware of the potential financial impacts of environmental issues. Consequently, they are increasing their requirements for environmental audits to review the environmental issues, management practices and systems when they are considering financing iron and steel making and related downstream operations. any banks have signed the United Nations Environment Program (UNEP) Statement by Banks on Environment and Sustainable Development. Banks in this category include National Westminster Bank, the Union Bank of Switzerland, Deutsche Bank, and the Royal Bank of Canada.
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