Three global banks are being paid to obscure who profits from 51 fossil fuel projects in Australia that produce 22m tonnes of carbon emissions each year, according to new analysis.

An analyst who authored the report says it highlights a “massive problem” in Australia that could be reducing the amount of scrutiny investors face for financial support of the fossil fuel industry.

US-based research group Global Energy Monitor (GEM) investigated the dominance of nominee companies in Australia, which are paid to be listed as shareholders on behalf of unnamed investors.

It found nominees were listed as major shareholders in 25 publicly listed energy firms in Australia, which collectively account for nearly 18% of the nation’s fossil fuel emissions.

Nominee companies are paid to be listed as shareholders on behalf of unnamed investors. Illustration: Global Energy Monitor

“Nominee companies are middlemen in corporate ownership: They hold shares in name only, masking the identity of the actual owners,” said the report by GEM research analyst Gabe Louis.

“This makes it incredibly difficult to pinpoint who is the actual shareholder. With no rules on nominee companies, fossil fuel backers can profit while staying hidden from public scrutiny.”

The report found almost all nominees in Australia were subsidiaries of the world’s largest banks.

It found three nominees, subsidiaries of Citibank, HSBC and JP Morgan, were listed as shareholders in companies producing carbon emissions roughly equivalent to the output of 4.4m Australian homes each year.

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The report found nominees were listed as owners of close to 70% of Origin Energy’s shares, two-thirds of Whitehaven Coal’s shares, and more than a third of AGL Energy’s shares.

“Because shareholders can exercise voting rights and benefit financially, understanding these ownership structures provides a clearer picture of which actors are connected to Australia’s fossil fuel sector,” Louis said.

“While there’s a lot the Australian government will need to do to hit its new climate target, making the ownership of fossil fuel interests more transparent is a low-hanging fruit.”

Jenifer Varzaly, an associate professor in commercial law at Durham University who has investigated nominee companies in Australia, said they may provide a “cloaking mechanism” for some investors.

In Australia, companies must disclose the names of investors that hold more than 5% of shares. But Varzaly said if the shareholding hovered below that 5% threshold, and was listed in the name of a nominee, then “the public will not know who sits behind it”.

While close to 70% of Origin’s shares are held by nominees linked to JP Morgan, HSBC and Citibank, others nominees are listed as owning tens of thousands of shares in the company but less than the 5% threshold.

Transparency International Australia’s chief executive, Clancy Moore, agreed nominee companies could “mask the true owners of corporate structures in Australia”.

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“With a draft bill in parliament, the Albanese government is taking the first steps in lifting the veil on corporate ownership in Australia,” Moore said.

“But more needs to be done to create a centralised, publicly accessible register of who ultimately owns and benefits from private and public companies in Australia.”

Legislation introduced to parliament last month would increase corporate transparency by creating a register of beneficial owners. But the legislation does not specifically address the issue of nominees.

The Greens spokesperson for economic justice, Nick McKim, said nominees “were letting coal, oil and gas profiteers cash in from the shadows”.

McKim said the Financial Action Task Force, a multilateral organisation that sets standards for corporate transparency, recently found Australia generally was only “partially compliant” with its recommendations on corporate transparency.

“If we had a public beneficial ownership register with teeth, nominee companies would be redundant,” McKim said.

In the UK, nominee companies that hold more than 25% of a company’s shares must disclose who is benefiting. This is not required in Australia.

Nominee companies are not exclusively used to mask investments in the fossil fuel sector. Close to 70% of shares in Australian pharmaceutical company CSL are registered with nominees, according to its latest annual report. About 90% of shares in property developer Mirvac are listed as being nominee companies.

Nominee companies also provide other services to investors including transaction settlement, administration and financial reporting.

Treasury, the treasurer’s office, Citibank, HSBC and JP Morgan were contacted for comment.