Member Sign In | Not a member? Register Now
Should pension funds be investing in companies with links to brutal governments?
Isn’t it time pension funds asked their members about their morals?
Should pension funds withdraw their investment from companies with links to repressive regimes?
The question is once again exercising the minds of scheme investment chiefs around the world.
The latest to decide it must is the $50bn (€34bn) Massachussets Pension Reserves Investment Management Board, which has sold $54m of shares in eight companies, including Alstom and PetroChina, targeted by the Sudan Divestment Task Force, a non-governmental organisation operating divestment campaigns in the US, and now working with pension funds in Europe. Massachusetts became the 21st US state to adopt a policy to divest from companies working with the Sudanese government. US pension funds have now pulled assets worth hundreds of millions of dollars from companies operating in Sudan, although it is notable that most have done so as a result of state-led political decisions.
It’s worth recalling why. Since 2003, more than 200,000 people are estimated to have died as a result of the conflict in Darfur where the government is accused of using militia death squads against its non-arab population.
The Sudan Divestment Task Force says the government relies heavily on foreign investment, particularly in oil companies, to fund the militias. It claims the authorities have shown an historic responsiveness to economic pressure, but that political pressure and diplomacy have failed to stop the genocide. Calvert, the big US SRI mutual fund company, which has also pulled Sudan investments, said it was “struck by the growing and potential further impact of the Sudan divestment movement, the most significant to have emerged since that directed at apartheid in South Africa.”
When a handful of European pension funds recently pulled almost €150m ($215m) in investments from French oil company Total in a matter of days in protest at the company’s involvement in Burma, they were making the same point as their US peers. In effect they were saying: we don’t want to be associated with these companies and believe that by making a public statement to that effect we may influence their behaviour. Targeted corporations counter that by pulling out of problem countries they could worsen the situation, depriving the country of much-needed investment and the promotion
Page 1 of 2 | Next »