Published by Global Compact Critics.
ABP had urged CNPC, repeatedly to improve its behavior to prevent complicity in human rights violations in Sudan. CNPC however failed to adequately address the concerns.
ABP’s investment policy is based on the ten principles of the Global Compact. ABP concludes that PetroChina / CNPC, lacks solid policies to prevent involvement in human rights violations in Sudan. Hence, PetroChina does not comply with the second principle of the UNGC, which states that businesses should make sure that they are not complicit in human rights abuses.
According to Thijs Steger, spokesman for ABP Investments, the pension fund has engaged with the local management of CNPC in Sudan and requested that the company would fulfill several demands. These included that the management should:
- execute an assessment of the impact of CNPC’s activities on the local community;
- be transparent on the working methods of their security staff;
- initiate a dialogue with their stakeholders and be accountable towards their stakeholders;
- publish a statement on their role in the democratic development processes in Sudan.
CNPC has responded that they do not comment on political situations. Mr. Steger stated that ABP repeatedly urged CNPC to meet the requirements, but that the company did not progress enough. ABP therefore decided to blacklist PetroChina.
In January 2009, over 80 civil society organizations including human rights, corporate accountability, and religious groups from 25 countries, as well as government officials submitted an open letter to the United Nations Global Compact (UNGC) in support of a formal complaint against PetroChina. PetroChina, the publicly traded arm of CNPC, is the leading oil company operating in Sudan, with extensive financial links to the regime. According to the complainants, the company was uniquely positioned to influence the government of Sudan, but failed to act and denying involvement in the humanitarian crisis in Darfur.
In July 2009 the Global Compact Board announced that they maintained PetroChina as a participant in the Compact. The Vice Chair of the Board, Sir Mark Moody-Stuart, said that CNPC had been “active in supporting sustainable development in the country [Sudan] […].” The Board also took note that CNPC “had engaged in Global Compact learning and dialogue activities on conflict sensitive business practices.”
ABP is not the first pension fund that has decided to divest from PetroChina. In 2008 PGGM, another Dutch pension investment giant sold its PetroChina shares after their own engagement strategy failed to produce results. At the time, PGGM said: “CNPC has not taken adequate steps to avoid involvement in these human rights violations or to contribute to resolving human rights issues in that country.” Moreover, in January 2009 the US pension group TIAA-CREF also sold its PetroChina shares in protest of PetroChina’s business links to the Sudanese government presiding over genocide in Darfur.
As opposed to findings of the Global Compact Board in 2009, ABP and other major pension funds, have evidence that PetroChina is in breach of principle two of the Global Compact. Therefore, one can conclude that the Board would have to reconsider its position on PetroChina’s participation in the Global Compact.
