Facing Finance report investigates abuses by 20 companies & ties to financial institutions

Facing Finance’s report “Dirty Profits 4” focuses on 20 multinational companies regarding allegations of abuse of human rights and environmental standards, and investigates the links between these companies and 4 financial institutions. The report finds that these companies’ and banks’ voluntary social commitments are not sufficient to prevent abuse, exploitation, corruption, and environmental destruction. Business & Human Rights Resource Centre invited the companies to respond - their responses and the full report can be found below.

credit: Facing Finance

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Company response
21 September 2016

Nautilus Minerals response

One of the many advantages of seafloor mining is that there are no local landowners or peopleliving on the site. The Solwara 1 Project site is approximately 25 km from land, in water depths of1,600 meters. There are no local landowners, or traditional “land uses” which the Mining Warden inPapua New Guinea (PNG) has stated this at numerous Exploration License (EL) hearings over aperiod of 10+years. It should also be noted that that traditional fishing rights in PNG do not extendmuch past the edge of coral reefs...

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Company response
27 July 2016

Pfizer response

Author: Pfizer

I would ask you to visit Pfizer.com for more information about both matters raised in the group’s further statement.

For your background:

Article
20 July 2016

Facing Finance rejoinder to company responses

We would very much like to thank the companies for their responses to our report, we appreciate their taking the time to respond and providing us with feedback on the information. We note their comments with interest and have enclosed a short response to each of the relevant companies. In response to some of the comments we have discussed internally how this will feed into the development of future Facing Finance reports and with this, have concluded that gathering company feedback at an earlier stage in the process will provide for constructive dialogue. We thank the companies for being willing to engage. The responses by companies are varied in their level of detail - some provide very limited detail regarding their concerns and thus it becomes difficult for us to respond accurately. Overall we have sought in our report to ensure that all sources are well referenced and to ensure that only reliable sources are used. Due to the nature of some of the violations it is a considerable challenge to gather information on these topics.Please find below our comments to the companies.

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19 July 2016

HSBC response to Facing Finance rejoinder

Author: HSBC

On defence, our position is quite clear and the publicly available defence policy, available at http://www.hsbc.com/our-approach/sustainability/finance [references]...anti-personnel mines and cluster bombs...other weapons...On shareholdings, we can only repeat that HSBC usually appears on companies' shares registers where it acts either as a custodian of assets for another financial institution or as the nominee holder. On the low-carbon economy, Facing Finance has taken one paragraph from the speech cited, that, on its own, does not reflect HSBC's approach to climate change. The speech highlights specific actions to move towards the low carbon economy, including for example green bonds for sustainable investment.  We recognise that within the energy sector, coal fired power plants are the most significant contributor to climate change...The revisions on the mining and metals policy, expected to be published later this year, will further extend the limitations on HSBC's involvement with coal...[also refers to statement on Forestry and Palm Oil]

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19 July 2016

Inditex response to Facing Finance rejoinder

Author: Inditex

Inditex has instituted significant supply chain transparency measures to ensure that suppliers and manufacturers comply with Inditex Code of Conduct as follows...As part of the Global Framework Agreement between Inditex and IndustriALL Global Union, Inditex shares on a regular basis with IndustriALL the full list of names, locations, orders and level of compliance with the Code of Conduct of its suppliers and factories at all tiers and all processes...Inditex publishes every year in its Annual Report relevant information and KPIs in order to inform stakeholders about the policies and programmes the company has in place to ensure the sustainability of the supply chain...Inditex’s sustainability practices and transparency are also evaluated externally...Inditex integrates sustainability as a core value to the business model. In this sense, the company counts with a Strategic Plan for a Stable and Sustainable Supply Chain 2014 – 2018 within which traceability is the cornerstone...

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19 July 2016

Total response to Facing Finance rejoinder

Author: Total

In the first version of the 2015 Report “Facing Finance”...it was mentioned that Total’s activities in Western Sahara were in breach of international law. As this statement was not accurate, we contested it and provided BHRRC with relevant information to support our position. We indeed consulted UN experts as part of our due diligence process...In response to the authors’ letter to companies dated 8 May 2016, please note that Total’s activities in this region have not been in breach of any ethical standards...

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Company response
15 July 2016

HSBC response

Author: HSBC

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Article
6 April 2016

Facing Finance report

Author: Facing Finance

"Dirty Profits 4: Report on Companies and Financial Institutions Benefitting from Violations of Human Rights," 16 Feb 2016

…[T]he Dirty Profits Report is born of the conviction that financial institutions (FIs) and corporations have a responsibility to respect human and environmental rights. This report is…focusing on 20 controversial globally active corporations and…commercial banks and asset management companies in Germany and internally, as selected by Facing Finance…Dirty Profits exposes the financial relations between these selected major…institutions…and multinational companies, across various sectors, that have consistently violated environmental and human rights standards…The report provides critical analysis of voluntary commitments made by corporations and FIs. It becomes apparent that despite making these commitments, organisations continue to violate even the most basic and most important standards. Given the fact that largely corporations are not held to account for violating these principles, the call for necessary regulations becomes urgent…There must be clear regulatory oversight of how FIs address human rights and environmental issues in all business relationships…[Also refers to Airbus, Allianz, Alstom, Anglo American, Audi, BHP Billiton, BMW, China Gold International Resources, Coca-Cola, Daewoo International, Deutsche Bank, EADS, ExxonMobil, Grupo México, HeidelbergCement, HSBC, Inditex, Lockheed Martin, Motorola, Nestlé, Pfizer, Posco, Rheinmetall, Rolls-Royce plc, Samarco, Sanofi, Syngenta, Total, Vale, Vanguard, Verizon, Volkswagen, and Zara.]

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Company response
5 April 2016

Allianz response

Author: Allianz

  • We appreciate reports creating an awareness for Environmental, Social and Governance (ESG) topics amongst investors...The investment exposures, reported in the Dirty Profits Report, do not correspond with our own figures.
  • The reported investment figures refer to our proprietary assets (Allianz insurance assets), as well as to our third party assets, which our asset managers PIMCO and AllianzGI manage on behalf of their asset management clients. PIMCO and AllianzGI are guided by the investment demands of their clients and fulfillment of their fiduciary duty. Both have signed the Principles for Responsible Investment (PRI) and integrate ESG aspect into their investment analysis and decision making...
  • As part of our risk diversification strategy we also consider the integration of ESG aspects into our investments as highly important to achieve long-term attractive returns for our insurance clients.
  • For our proprietary assets (Allianz Insurance Assets) we apply a systematic ESG approach, which we have developed throughout the past years and are continuously improving.

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Company response
5 April 2016

Alstom response

Author: Alstom

First, we would like first to thank you for offering us a response…

Alstom sold its energy activities to General Electric…However, the Report...mentions several power projects...wrongfully indicating that these projects are under execution by Alstom. This applies specifically to references...to...Sarawak Corridor of Renewable Energy in Borneo, the construction of the Belo Monte Dam in Brazil, or the construction of the coal power stations Kusile and Medupi in South Africa…

Regarding the Merowe Dam project in Sudan...this is a past project that has been completed…Alstom has neither sales in Sudan nor any personnel…

With respect to references…to activities in Israel, Alstom confirms that it has supplied equipment for the light rail tramway...in Jerusalem…However, Alstom firmly refutes the allegations whereby it would have breached applicable laws when performing this project…

[R]egarding...the position taken towards Alstom by certain private and pension funds, Alstom would like to clarify that Norges Bank…actually removed Alstom from this list…

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