Norway's Govt. pension fund excludes Chinese co due to "unacceptable risk" of human rights abuses in garment factories in Vietnam

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Article
17 January 2019

Council on Ethics' recommendation to exclude Texwinca Holdings Co

Author: Council on Ethics

[T]he Council on Ethics recommended to exclude the company Texwinca Holdings Ltd from the Government Pension Fund due to an unacceptable risk of the company being responsible for systematic human rights violations.

Texwinca is a Chinese company that produces yarn, knitted fabrics and garments. Texwinca owns 50 per cent of the shares in Megawell Industrial Ltd, making it that company’s largest shareholder... Texwinca states that it does not have a controlling influence over Megawell, and that it has no responsibility for the working conditions at the factories in Vietnam.

The recommendation is based on investigations into working conditions which uncovered systematic norm violations at Megawell’s factories in Vietnam, including discrimination against women, numerous occupational health and safety hazards and restrictions on freedom of association. Texwinca’s dominant shareholding [...] leads the Council to presume that Texwinca has significant influence over Megawell. The Council attaches importance to the fact that Texwinca has not helped to clarify this case and concludes that neither Texwinca nor Megawell are taking any responsibility for the prevention of human rights violations at the factories in Vietnam. The Council on Ethics considers that when a company in this way disclaims responsibility for preventing norm violation [...], the risk of systematic labour rights violations becomes unacceptably high.

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Article
17 January 2019

Decisions to exclude companies from the Government Pension Fund Global

Author: Norges Bank

Norges Bank has decided to exclude Texwinca Holdings Co due to unacceptable risk that the company is responsible for serious or systematic human rights violations...

The Executive Board has not conducted an independent assessment of all aspects of the recommendations but is satisfied that the exclusion criteria have been fulfilled...

The Executive Board's decision on exclusion were made based on a recommendation from the Council on Ethics.

The Executive Board has also decided to exclude Evergy Inc and Washington H. Soul Pattinson & Co Ltd. based on an assessment of the product-based coal criterion... The Executive Board's decision on exclusion were made based on a recommendation from Norges Bank Investment Management.

Before deciding to exclude a company, Norges Bank shall consider whether the use of other measures, including the exercise of ownership rights, may be better suited. The Executive Board concludes that it is not appropriate to use other measures in these cases.

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Author: Council on Ethics

道德委员会建议政府养老基金将德永佳集团公司(Texwinca Holdings Ltd)除名,原因是该公司存在难以容忍的系统性侵犯人权的风险。德永佳是一家生产纱线、针织面料和服装的中国公司。 拥有伟佳针织(Megawell Industrial Ltd) 50%的股份,为该公司的最大股东... 德永佳声称它对伟佳没有控制权,并且对越南工厂的工作条件不负任何责任。

该建议基于对伟佳公司工作条件的调查。调查揭露该公司在越南的工厂发生的系统性违规行为,包括对妇女的歧视,众多的职业健康和安全危害以及对结社自由的限制。 委员会认为德永佳持有伟佳主要股份,理应对其具有重大影响力。委员会强调德永佳没有帮助澄清此事,并得出结论认为德永佳和伟佳都没有对防止越南工厂的侵犯人权行为承担任何责任。道德委员会认为,当公司拒不承担预防违规的责任时,系统性侵犯劳工权利的风险就会高到令人无法接受。

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Author: Council on Ethics

道德委員會建議政府養老基金將德永佳集團公司(Texwinca Holdings Ltd)除名,原因是該公司存在難以容忍的系統性侵犯人權的風險。德永佳是一家生產紗線、針織面料和服裝的中國公司。擁有偉佳針織(Megawell Industrial Ltd) 50%的股份,為該公司的最大股東... 德永佳聲稱它對偉佳沒有控制權,並且對越南工廠的工作條件不負任何責任。

該建議基於對偉佳公司工作條件的調查。調查揭露該公司在越南的工廠發生的系統性違規行為,包括對婦女的歧視,眾多的職業健康和安全危害以及對結社自由的限制。委員會認為德永佳持有偉佳主要股份,理應對其具有重大影響力。委員會強調德永佳沒有幫助澄清此事,並得出結論認為德永佳和偉佳都沒有對防止越南工廠的侵犯人權行為承擔任何責任。道德委員會認為,當公司拒不承擔預防違規的責任時,系統性侵犯勞工權利的風險就會高到令人無法接受。

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Article
5 June 2018

Recommendation to exclude Texwinca Holdings Ltd from the Government Pension Fund Global

Author: Council on Ethics

The Council on Ethics recommends that Texwinca Holdings Ltd be excluded from investment by the Government Pension Fund Global (GPFG) due to an unacceptable risk that the company is responsible for systematic human rights violations...

The Council contacted Texwinca for the first time in June 2015 to request information about working conditions at the company’s factories in Vietnam. Texwinca replied by referring the Council to the company’s annual report and its Environmental, Social and Governance (ESG) Report...

In October 2016, the company was sent a draft recommendation to exclude it from the GPFG that had been prepared on the basis of the Council’s investigations. Texwinca replied that the company did not wish to comment on the recommendation.

To obtain a broader basis for assessing the company, Kollan was investigated in May–July 2017. Texwinca was sent a new draft recommendation to exclude the company in February 2018. Once again, the company said it did not wish to comment on working conditions at the factories.

In its communications with the Council on Ethics, Texwinca has commented solely on its corporate structure, but has otherwise provided no information about the matter at hand. According to Texwinca:

“We have no comment on the enclosed draft recommendation. As explained in our previous communication, it is the Group’s strategy to remain as a passive investor in the Megawell business. To allow maximum appropriate authority to the managers of Megawell Group to operate and expand the business, it was agreed that we would impose the minimum intervention in the business of Megawell. Though we hold 50% equity interest in Megawell Group, the other two active investors, acting in concert and collectively own the remaining equity interest, also maintain 50% controlling interest in Megawell Group. Thus, we have no legal right to exercise full control on Megawell.”

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