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Are B.C. pensions financing Sudanese genocide? By Travis Lupick
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Dec 4, 2008 - 6:14:51 AM

Are B.C. pensions financing Sudanese genocide?

By Travis Lupick
 

Janjaweed militia have slaughtered and raped hundreds of thousands of people in Darfur. So imagine the surprise of an activist UBC graduate when he discovered that his former instructors’ pensions could be helping to fund the genocide in the western region of Sudan.

Joel Stephanson, a member of Students Taking Action Now Darfur, has traced money invested in public-sector pension funds from Vancouver to Sudan. He told the Georgia Straight that in B.C. many public-sector workers’ pension funds are managed by the B.C. Investment Management Corporation, which has invested in companies of concern for their activities in Sudan.

“It can be hard to avoid bad or unethical opportunities, but that doesn’t really mitigate the horrendousness of it,” Stephanson said.

Since 2003, Sudan’s western Darfur region has seen an estimated 400,000 people killed and 2.7 million displaced, according to UN reports. The violence has targeted black Africans and is widely attributed to Arab militias backed by the Sudanese government.

According to bcIMC’s Web site, the Crown corporation administers $85 billion worth of assets in investments that finance the retirement benefits of more than 430,000 British Columbians. Among those whose pension funds are managed by bcIMC are college and university instructors, teachers, police officers, firefighters, health-care workers, and members of the legislative assembly.

On November 30, the Sudan Divestment Task Force—a project of the Genocide Intervention Network—released the latest edition of its Sudan Company Rankings report. Present on that list are 18 companies that are also on bcIMC’s most recent inventory management list (dated March 31, 2008). The Crown corporation’s investments in these companies were valued at $452.4 million.

Of that sum, $127.3 million was invested in nine “category one” companies described by the SDTF as “highest offenders”. The document explains that “these companies have proven largely unresponsive to engagement by shareholders or unwilling to alter problematic practices.”

A further $325 million was invested in “category two” companies, which SDTF does not recommend for divestment but targets for continued shareholder engagement.

Speaking from Washington, D.C., Adam Sterling, divestment director for SDTF, said that to appear on the list a company must support the Sudanese government at the expense of marginalized populations. For example, a company providing irrigation services would not be targeted; a company selling diesel engines that could be used in weapons systems would.

Sterling explained that SDTF tries to establish a dialogue with a company of concern. “The targeted divestment model focuses on engagement first and trying to change corporate behaviour,” he said. “The dropping of shares is really a last-ditch option.”

Susan Enefer, manager of shareholder engagements for bcIMC, said she has spoken with SDTF, and she readily acknowledges that bcIMC manages investments in companies on the Sudan Company Rankings list.

“We are capitalists, pure and pure,” she told the Straight in a telephone interview. “But we are trying to make way for additional factors in our [investment] considerations.”

The worst offender on SDTF’s list is the China National Petroleum Corporation.

The bcIMC inventory list states that it held $4.7 million in Petrochina, which Sterling described as the “listed arm” of CNPC.

According to an SDTF-drafted company profile, CNPC is the largest player in Sudan’s oil industry. The document claims that the oil consortium of which CNPC is a member has perpetuated human-rights abuses, including the “violent displacement of local peoples”.

Enefer said that bcIMC has tried to engage companies on SDTF’s list, and that since those efforts began about 15 months ago, nine companies have responded.

According to Enefer, bcIMC has never divested from a company for ethical reasons. Asked if divestment from a company like Petrochina would ever be considered, Enefer replied: “At this point in time, there is a stronger argument for our keeping that company in our portfolio than not keeping it.”

When considering divestment, a trustee like bcIMC must take into account its fiduciary duty, or legal obligation, to act in its clients’ financial best interest.

Shareholder activist Peter Chapman explained that this is reconcilable with SDTF’s recommendations for divestment, because social, environmental, and governance factors can bear on an investment’s risk and rate of return.

Chapman, executive director of the Vancouver-based Shareholder Association for Research and Education, told the Straight that companies that are governed well tend to be wiser investments.

Stephanson has been involved in campaigns to help the people of Darfur for more than two years. He conceded that a “numbness or malaise” is difficult to avoid when faced with the horrors of a situation like Darfur. But, he added, pension investments are something that people can try and use to make a difference.




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