Swedish AP funds exclude Barrick, Agrium and Motorola Solutions over international convention breaches

The exclusions follow unsuccessful engagements, says ethics panel

Four Swedish state AP Funds (AP1, AP2, AP3 and AP4) have excluded their holdings in Canadian fertilizer firm Agrium, communications company Motorola Solutions and gold miner Barrick Gold, after their Ethical Council recommend the exclusions due to violations of international conventions.

It follows a period of unsuccessful engagement with the companies by the Swedish state pension funds’ ethical body.

The Ethical Council has recommended exclusion of Barrick due to serious negative environmental impact by depositing tailings in river systems. In 2013, the New Zealand Superannuation Fund exited the gold miner, which has operations in Papua New Guinea and Tanzania, for similar reasons. It comes as Barrick said earlier this month that it had reached an out-of-court settlement with women allegedly raped by security guards at its mines in Papua New Guinea.

The recommendation to exclude Motorola Solutions is based on its involvement in customized monitoring systems for settlements in the occupied parts of the West Bank.

It has been an issue for several years, with the council calling on Motorola to leave the West Bank. Motorola is reportedly trying to find a buyer.

And with fertilizer firm Agrium, the Ethical Council recommended exclusion for its purchase and use of phosphates from the disputed territory of Western Sahara. Last year Norway’s KLP and Swedish Pensionfund Sjunde AP-fonden (AP7) exited Agrium for similar reasons. AP7 also excluded Barrick Gold last December.

All three recommended exclusions, accepted by the AP funds, are outlined in the Ethical Council’s new annual report.

It had 308 dialogues last year on human rights, anti-corruption and sustainability. Highlighted successes include toy manufacturer Mattel, which it has encouraged to talk with its supply chain on poor working conditions. The report also focuses on improvements made in the mining industry following engagement and its work ensuring the abolition of child labour at cocoa plantations.

“Preventive and proactive projects are important for the Ethical Council and it is important that these lead to concrete and positive results. Engagement makes a difference,” says Ossian Ekdahl, chairman of the Ethical Council for 2015.

He went on: “Reactive, event-driven dialogues will always be a part of the Council’s work, but preventive projects is often a better way to achieve change where the companies are more receptive to suggested improvements, in order to avoid future problems.”

The Ethical Council is a collaboration between the First, Second, Third and Fourth Swedish National AP-Funds with the goal to influencing companies to a more sustainable business. The Ethical Council was formed in 2007.

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