€3tn investor group ramps up pressure on companies over Myanmar

Statement comes as Norwegian sovereign wealth fund gets stricter policy for investments linked to conflict

A number of major asset owners and managers have teamed up to tell their portfolio companies to step up their responses to human rights violations in Myanmar. 

A group of 77 investors, led by Norway’s Storebrand Asset Management, US-based Domini Impact Investments and advocacy group Heartland Initiative, has backed a statement asking firms to outline their business activities in Myanmar and address any potential human rights impacts.

The move comes as the UN’s head of human rights, Michelle Bachelet, warned today of escalating violence in Myanmar. The country was subject to a military coup in February and there are now reports that security forces are shelling civilian homes. 

“In the last months Storebrand has been conducting due diligence on companies with operations in Myanmar to try to establish which have links to the military junta and potential human rights violations”, said Kamil Zabielski, Head of Sustainable investment at Storebrand Asset Management, although the investor statement does not disclose the names of target companies. 

“Sharing of resources and collaboration will make it easier for investors to engage companies and exercise more leverage. We see this initiative as an opportunity for the private sector to show leadership by assisting Myanmar’s transition to peace, justice, and democracy,” he added.

Amongst the signatories are several Danish pension funds, including P+, PKA and Velliv, which all confirmed recently to RI that they were engaging with investee firms on Myanmar. 

Absent from the list are Dutch pension funds ABP and PFZW, both accused in March of having $2bn invested in companies with alleged links to Myanmar’s military.

The asset management arm of Norwegian pension giant KLP is a signatory to the letter. 

Top lawmakers in Norway have just approved a weapons exclusion policy that would prevent the country’s sovereign wealth fund, Government Pension Fund Global, from investing in weapons linked to armed conflict. The Storting, Norway’s parliament, gave the green light to the stricter policy at the request of the fund’s Ethics Committee. 

It will be down to its in-house asset management, Norges Bank Investment Management (NBIM), to make the exclusion decisions based on recommendations from the Committee. 

The news on Wednesday was celebrated by a group of ethical investors and campaigners that have been engaging with the Norwegian fund over its ownership of German arms manufacturer Rheinmetall. 

“We welcome the recommendation of the Ethics Committee of the Norwegian Pension Fund being approved and that in future arms companies will be banned from the investment universe for irresponsible arms export practices,” Tommy Piemonte, Head of Sustainable Investment Research at German Catholic investor Bank für Kirche und Caritas, told RI. “Investors should stop supporting companies that export arms to countries that are involved in or contribute to human rights abuses – especially if certain sustainability principles are to be followed in investment”.

Last month, NBIM axed two companies from the Fund over their activities in the West Bank following recommendations from the Council on Ethics.