Church Commissioners exit oil firm SOCO over Virunga operations

The decision follows “extensive and sustained” engagement

The £6.7bn (€9.5bn) Church Commissioners, which manage investments for the Church of England, have today (July 1) announced a “full divestment” from their £1.6m holdings in London-listed oil firm SOCO International relating to its activities in the Virunga National Park in the Democratic Republic of Congo.

It follows a recommendation from the Ethical Investment Advisory Group (EIAG) of the Church of England and what it terms “extensive and sustained engagement” with the company.

The EIAG began the engagement following a series of allegations of human rights abuses, bribery and corruption related to SOCO’s operations in and around Virunga.

The Church Commissioners and the Pensions Board say they have persistently raised concerns with SOCO since November 2013, with engagement intensifying since December 2014.

There are four main areas of concern. These are the need for the instigation of a wide ranging and transparent independent enquiry addressing the allegations of bribery, corruption and human rights abuses, the lack of independent and effective corporate governance, the adoption of best practice, internationally recognised, environmental and social standards and unequivocal respect for park boundaries within a World Heritage Site.

Adam Matthews, Secretary of the Ethical Investment Advisory Group, led the engagement.

He said: “We are deeply concerned about the failure of SOCO International to properly and fully address ourfour concerns, in particular to ensure that an open and transparent enquiry is held into the allegations of corruption and human rights abuses. “At the recent AGM we asked the board to urgently consider the appointment of an independent chairman to ensure SOCO could finally openly and transparently address the concerns of shareholders. The response of the company that has emerged from our engagement and crystallized at the AGM has led us to recommend full divestment.”

“This is not a sustainable or ethical investment for Church funds.”

Edward Mason, Head of Responsible Investment at the Church Commissioners, added: “We have called time because without the changes we sought this is not a sustainable or ethical investment for Church funds.”

The divestment is just the third time in the past five years that the church has divested from a company on ethical grounds. It sold out of News Corp. over the phone hackling scandal in 2012 and two years earlier exited mining giant Vedanta over human rights concerns.

In other news, the General Synod of the United Church of Christ, one of the largest US Protestant denominations, has overwhelmingly (80%) approved a resolution calling for divestment from companies that profit from Israel’s occupation or control of Palestinian territories. “This allows us to sustain and strengthen our voice against the occupation,” said Peter Makari, executive for the Middle East and Europe.