Another two companies excluded
06.02.2009
Another two companies were excluded from KLP’s investment portfolio as from June. At the same time, all of seven companies have been reinstated in the portfolio.
KLP has had its half-yearly review of which companies to invest in in accord-ance with the Company’s ethical criteria. Another two companies have been excluded, namely Incitec Pivot and DongFeng. Moreover, two companies - Eutelsat and Exxon Mobil - are under critical observation.
”Critical observation” means that a company is close to being excluded but that we consider the best measure to implement in the given situation as being dialogue and the exercising of ownership. As with KLP’s exclusions we shall publicly name the companies and also give the reasons why they are under critical observation.
Incitec Pivot is being excluded from KLP’s investment portfolio because it imports phosphatic stone from West Sahara, which is occupied by Morocco. The International Court of Justice (ICJ) has established that Morocco has no legal claim on West Sahara and therefore neither on West Saharan natural resources.
”The extraction of natural resources from occupied areas, in particular West Sahara, was also declared illegal in 2002 by the UN Deputy Secretary General for Legal Issues. KLP has already excluded one company for the same reason”, says Jeanett Bergan, Manager Responsible Investments, KLP Kapitalforvaltning.
Seven are being reinstated
Another seven companies are being reinstated [??] in KLP’s investment universe, namely Exxon Mobil, Grupo Ferrovial, Marathon Oil, Monsanto, Richemont, and Thales. PetroChina is also being reinstated but will not be included in the global index.
”KLP has had a direct dialogue with four of the companies and it is therefore gratifying to see that systematic efforts in these areas may have helped get the companies to do something about the reprehensible conditions”, says Jeanett Bergan.
Marathon Oil was excluded from KLP’s investments on suspicion of corruption in Equatorial Guinea.
- Marathon is now able to refer to a robust anti-corruption policy and control systems. In dialogue with KLP the company has accounted for its zero-tolerance when it comes to corruption, company guidelines and established controls for preventing corruption. The company has now received confirmation from the US authorities that they have finished investigating the case”, says Bergan.
Exxon Mobil has been excluded from KLP’s investments for the same reason as Marathon Oil, namely the corruption case in Equatorial Guinea.
“Exxon is now able to refer to its solid anti-corruption effort and has played an active role in the development of the anti-corruption programme Extractive Industries Transparency Initiative (EITI). Its dialogue with the Company and other interested parties confirms its major commitment to preventing corruption and influencing the authorities in Equatorial Guinea”, says Bergan.
Sorted out environmental damage
Grupo Ferrovial has been excluded because the company was involved in a motorway project that destroys areas and wildlife protected by law. In 2007 the EU Commission sent out several warnings to the Polish authorities in respect of the construction of the Via Baltica motorway.
”The company has done something about the situation, worked for a solution that is satisfactory to all parties concerned, and has made a major effort to improve the risk management. Dialogue with the Company and other interested parties proves that the company is committed and responsible” says Jeanett Bergan.
The reason Monsanto was excluded was its unwillingness to take responsibility for the damage to the environment that was caused in Wales. The company dumped its chemical waste in the Brofiscin area in the 1960s and ‘70s.
”Monsanto’s dialogue with the Company and interested parties confirms that it is willing to cooperate with the authorities in order to get rid of the problems and the pollution. Planning of the rehabilitation effort in the area has started”, says Bergan
For further information, please contact
Jeanett Bergan, Manager Responsible Investments, KLP Kapitalforvaltning
tel. +47 92 03 85 89, or e-mail: jeanett.bergan@klp.no
Heidi Finskas, Adviser Responsible Investments, KLP Kapitalforvaltning
tel. +47 45 88 04 60, or e-mail: heidi.finskas@klp.no
Ole Jacob Frich, Executive Vice President Communication, KLP
tel. +47 22 03 78 96 / +47 90 91 55 23 or e-mail: ole.jacob.frich@klp.no