afrol News, 30 November - Three international oil companies have been blacklisted for unethical business practices due to their involvement in large-scale corruption in Equatorial Guinea: ExxonMobil, Amerada Hess and Marathon Oil. The growing numbers of investment funds only investing in ethically cleared companies thus are now withdrawing from Marathon and Exxon Mobile.

The Swedish consultant company GES Investment Services yesterday published an update of companies that investors should avoid for ethical reasons. A risk study made by the Swedes recommended its institutional clients to "exclude - or engage in active dialogue with - three oil companies: Amerada Hess, ExxonMobil and Marathon Oil."

GES Investment Services had conducted a risk study named "Corruption in the Oil Industry," looking at 23 of the world's largest oil and energy companies. Three of these companies - ExxonMobil, Amerada Hess and Marathon Oil - had been "involved in serious corruption incidents," the Swedish analysts found, referring to the situation in Equatorial Guinea.

The three were all involved in a major corruption case in Equatorial Guinea, which now is being investigated by the US government. The US Senate Permanent Subcommittee on Investigations has already criticised the companies for having "systematically paid hundreds of million dollars over a period of several years to the President and dictator of Equatorial Guinea, his relatives and government officials, in order to get a share of the country's oil wealth," according to GES.

The Swedish company further noted that "the regime in Equatorial Guinea has been compared by the senate with that of Saddam Hussein's." The country is one of the world's poorest, where 65 percent of the population lives in extreme poverty. "Despite large oil- and gas reserves, 80 percent of the national income ends up in the pockets of only 5 percent of the population," GES noted.

- Any company entering this country or one with a similar situation, inevitably exposes itself to an enormous risk of being accused of complicity in as well as fuelling of the prevailing conditions, said GES Managing Director Magnus Furugård. "This increases the risk for brand damages, costly lawsuits, increasing costs of investments and possibly loosing the investment," he added.

GES Investment Services advises a large number of investments funds in Scandinavia and internationally, in particular large institutional clients. Many public and private funds in Europe lately have put emphasis on ethic investments, which also have earned a reputation of paying off better than unethical investments over the middle and long run.

The recommendations by GES Investment Services are set to produce a significant divestment in the three newcomers on the blacklist. First announcements of investors withdrawing from the controversial oil companies have already been made in Scandinavia.

KLP Insurance, which is one of Norway's largest institutional investors with total assets at about 140 billion NOK, has already announced its disengagement in ExxonMobil and Marathon Oil after their inclusion on GES Investment Services' blacklist. KLP yesterday issued a press release, saying it would divest in these two companies "due to corruption" charges against them.

- As it is known, KLP operates by minimum ethical standards in all its financial investments, the statement said. "The company among other uses central UN conventions and statement as a basis. In June this year, the UN's Global Compact expanded its nine principles regarding environment and human rights with a tenth one, dealing with corruption." KLP thus had listened to the advices of GES Investment Services.

By staff writers

© afrol News

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