Wednesday, 22 June 2011
Swedish pension fund managers would do anything for extra returns and have now lost ideas of how to properly run an ethical fund management business. They have turned to the cruellest and easiest option: investment in unethical companies. Swedish pension funds made up of billions of Skr are invested in some 30 companies blacklisted for violating human rights and related.
The Swedish Parliamentary investigation service exposed this practise in a recent investigation carried out to determine how a company of this stature invests our pension money. Swedish people would likely want to know how and where their pension money is invested.
According to Ulla Andersson of the Swedish left party, these investments are not properly and regularly talked about.
The Left party has ordered a review by the Parliamentary investigative services about the Swedish AP funds' holdings. Among other things, the company funds have holdings in companies that have been accused of human rights violations and are on various blacklists.
The survey found fifteen companies that the Swedish asset management firm, the AP Fund and the Norwegian state pension fund pursue abroad, blacklisted but held by pension funds.
There can be fifteen companies in a list of companies in which the Danish organization, Danwatch, examined and accused of exploitation of labour and natural resources in other countries.
For the two funds, it was information on their Annual Report of 2010 that was used whereas for the Danwatch data, it came from the last year’s February numbers.
Among the blacklisted companies include the U.S. supermarket chain, Wal-Mart, which is alleged to have worked against unions. First, Third and Fourth AP Fund has investments worth a total of over Skr800 million in Wal-Mart company, the report said.
Power giant Alstom is another blacklisted company. The company has been criticized for not having taken responsibility for human rights in connection with the construction of dams in Sudan. It owns all four AP funds shares worth a total of Skr546 million according to the compilation.
A third example is the Chinese state oil giant CNOOC, which is alleged to have violated human rights in Burma. The Company's First and Third AP fund portfolios with a value of approximately Skr 290 million is invested there, according to the review.
In total, the value of black-listed holdings is accounted to approximately eleven billion.
“The AP funds, our retirement money and we want to get into a debate about whether it is reasonable to invest money in such companies,” says Ulla Andersson.
The Left party also thinks that pension funds are using too little resources to examine these issues. The cost of the ethical advice that the funds use is one thousandth of the total costs of the Fund's investment activity, according to Ulla Andersson.
She also calls for more transparency in the AP funds' investments and operations.
“Today, AP pension reviews itself, and the fund pays the consultant who reviews their ethically questionable investments,” says Ulla Andersson.
The Left party must file a motion to parliament and require that it the Fund adds an independent evaluation body to examine whether the company’s pension funds are invested in organisations that are living up to ethical guidelines on human rights.
The party would also like to see a broad parliamentary review of the AP funds' investment rules so that for the socio-economic, ethical and environmental considerations, such should carry more weight than it is today.
“It is important that the AP funds' confidence is high given their mandate to manage our retirement money,” says Ulla Andersson.
AP fund is not the only pension fund company that invest in funny black listed companies. In Finland the pension fund there was last year accused of investment in companies that produce guns and amazements.
The irony is that these black listed companies are very attractive with higher returns and these fund managers would do anything, even it is to start a third world war just to make extra money mostly, also for themselves as they are hugely rewarded when returns are good.
By Scancomark.se Team