Stop the City of London laundering blood money from mining
If you run a mining company and want to get away with fraud, pollution, complicity in torture and even murder, then a listing on the London Stock Exchange (or its sister Alternative Investment Market) is for you.
But not, perhaps, for much longer if campaigners from the London Mining Network have their way.
They are seizing the opportunity presented by a bill currently going through Parliament that will replace the weak and discredited Financial Services Authority with a new body, the Financial Conduct Authority (FCA).
The campaigners – an alliance of 27 groups concerned about global impact of mining groups listed or financed in the city – are pressing for tighter monitoring of mining companies to be included within the powers of the new authority.
Currently half of the world’s biggest mining companies are registered in London, the leading global centre of mining finance.
Some are attracted by the UK’s ‘light touch’ regulation which allows companies to be listed in London that would not be acceptable on the Hong Kong Stock Exchange, for example.
In a damning new report, UK-listed Mining Companies and the Case for Stricter Oversight, the London Mining Network highlights miners that in recent years have had outstandingly bad records of poor governance, environmental destruction, illegality and complicity with human rights and workers’ rights abuses. Two of those listed, Vedanta and Barrick Gold, have been blacklisted by the ethics council of the Norwegian Government but still enjoy the kudos of a London listing.
Vedanta, with major mining concerns in India, has been described as the worst case and a ‘serial offender’ on practically every criterion. The counts against African Barrick (a subsidiary of Barrick Gold) include serious toxic pollution and complicity in shooting citizens in Tanzania. Other companies highlighted are African Minerals (fraud and pollution in Sierra Leone); Brinkley Mining (corrupt dealings in DR Congo); GCM Resources (complicity in killing three and injuring more than 100 protesters in Bangladesh); Bumi (corruption and poor governance in Indonesia); and Glencore, which is currently planning a major merger with Xstrata to create one the world’s biggest corporations.
Glencore’s activities in the Democratic Republic of Congo, the world’s poorest country according to the United Nations, have drawn the condemnation of two Swiss NGOs, Bread for All and Catholic Lenten Fund. In 2011 they accused Glencore of a range of human rights abuses, of employing child labour, causing pollution and evading taxes. According to the NGO Global Witness, Glencore also has questions to answer about how it came to co-own mining interests confiscated by the government of DR Congo, ‘raising possibilities that Glencore is implicated in grand corruption in the least developed country on earth’.
Because such businesses are listed in London, and particularly if they are also on the FTSE 100 of top companies, ‘worker pension funds may well be investing in them, along with high-street banks and insurance companies,’ said Richard Solly of the London Mining Network, launching the report.
The London Mining Network is calling upon the new Financial Conduct Authority to enforce good conduct on all UK-listed companies. The new body must, the campaigners say:
* make sure that London listed companies and their directors obey the law in the UK and the countries in which they operate. This must include compliance with national regulations concerning biodiversity, ecological and environmental protection.
* have powers to enforce corporate reporting.
* ensure that companies recognize and respect international human rights and environmental standards (including the Rights of Indigenous peoples) and implement the highest environmental, social, cultural, labour and healthy and safety standards.
* back strong reporting rules, including public reporting of payments to government.
People and organizations concerned about the conduct of UK-listed companies should be able to make their concerns known to the FCA through an accessible and transparent procedure.
Up to now it’s been up to NGOs, community groups and journalists to dig out and expose the truth about what mining companies are up to, often at considerable risk to themselves.
‘The regulatory authorities ought to be doing this and vigorously,’ says Richard Solly.
The full report, with details of the highlighted companies’ misdemeanors, is available here.