LONDON (Thomson Reuters Foundation) – Swiss bank Credit Suisse has violated its own commitments to human rights by becoming a major investor in a Vietnamese rubber giant implicated in land grabs and human rights abuses in Cambodia and Laos, according to the environmental and human rights watchdog Global Witness.
Credit Suisse became the second largest investor in Hoan Ang Gia Lai (HAGL) after swapping bonds that it held in the company for more than 10 percent of the company’s shares, two weeks after the release of ‘Rubber Barons,’ a report released by Global Witness that was highly critical of HAGL’s human rights record, in May of this year.
Global Witness is calling on the company to review its due diligence process for investment decisions.
A Credit Suisse spokesperson refused to comment but the company’s website says that it “examines sensitive aspect of transactions” when its clients engage in major resettlements or other actions that could affect local communities.
“Credit Suisse talks a good game, but it is actively enabling the land grabbing crisis that is sweeping across Cambodia and Laos by financing this company,” Megan MacInnes, campaign leader for land at Global Witness said.
“The bank trades heavily on signing up to ethical initiatives like the UN Global Compact and the Equator Principles, so why is it profiting from the misery of those who have lost their land and forests to HAGL?” MacInnes added.
The Global Witness report documented land grabs carried out by HAGL and the Vietnamese Rubber Group in Cambodia and Laos in which large tracts of forest belonging to local communities were bulldozed for rubber plantations. CBR Investments, Deutsche Bank and a private investment arm of the World Bank all held shares in HAGL, the report said.
While CBR Investments and Deutsche Bank have since divested from HAGL, Credit Suisse told Global Witness that the bank is legally obliged to hold its shares in HAGL for a minimum of 12 months from the date of the bond swap.
Divestment is not necessarily the end goal of the Global Witness campaign, MacInnes said, pointing out that the watchdog did not call for the other companies to divest until six months after the release of “Rubber Barons” because it hoped that the investors would pressure HAGL to improve the situation.
HAGL claims that the situation has improved and has described Global Witness’ information as “untrustworthy,” but Global Witness says that it has consulted villagers affected by the company’s activities who said that little has changed.
“They really haven’t made any improvement at all on the ground. It has been a lot of talk but very little action,” said MacInnes.
“What we want is for [Credit Suisse] to engage with the company in order to bring the company’s operations in line with the law and address the community’s concerns,” she added.