ABB has hit back at investors and critics concerned at the
multinational engineering group’s involvement in business operations in
Sudan.
The Zurich-based company has taken the unusual step of
issuing a public statement on its operations in the African country,
where, it says, its involvement is limited and, in any case, beneficial.
In
the statement, which is in part a response to investor interest in
human rights problems in Sudan, ABB acknowledges the ‘legitimate
concerns among international stakeholders’, but argues it is ‘acting as
a force for progress in Sudan’ by supporting development that is
increasing access to education, healthcare and clean water.
Several
US states, including Illinois, Louisiana, New Jersey and Oregon, are
withdrawing millions of dollars of pension fund holdings in companies
that trade in Sudan, on political and human rights grounds.
Supporters
of divestment hope it will exert pressure on the Sudanese government to
end conflict in the Darfur region, where at least 300,000 people have
been killed since February 2003 by Arab militias, allegedly with
government support. US companies have been banned by federal law from
operating in Sudan since 1997. A number of US states have also passed
laws that require their public pension funds to divest holdings in
overseas companies with links to Sudan.
Some socially
responsible investors say this state legislation is a blunt instrument
that does not recognize benefits to Sudan of companies working there.
One UK-based SRI analyst told EP:
‘It’s a typical US-style approach that does not allow for engagement
with firms or any recognition that some businesses may behave better
than others in the country.’
ABB supplies power transmission
and distribution equipment for the Merowe dam project on the Nile,
which will provide electricity for the Sudanese capital Khartoum and
two other cities. It has also supplied instrumentation to an oilfield
in Heglig in the south. The company says its business volume in Sudan
is ‘low’, in 2005 accounting for just $20million (£10.7m) of its
$22billion turnover.
The company says it is proud of its work in
Sudan, is not complicit in human rights abuses, and for more than a
year has carried out extensive stakeholder dialogue there. ‘No one in
Sudan has advised us to withdraw, as proposed by certain concerned
foreign investors,’ said Ron Popper, group vice president of corporate
communications. He claims that, on the contrary, [Sudanese
representatives] have unanimously recommended that ABB remains there to
help develop the country’s economic and social infrastructure. To
withdraw … would undermine such efforts.’
Outside the country,
ABB has been consulting with the Amnesty International Business Group
and organizations such as the Business Leaders Initiative on Human
Rights (BLIHR). It says Amnesty has told the company to ‘proceed with
caution and engage in stakeholder dialogue … [which] is what we are
doing’.
As part of its discussions with interested parties, ABB
says it has also had ‘full and frank meetings’ with a small group of
investors, mainly state pension funds in the US. It recently drew up,
as part of its work in BLIHR, a human rights checklist for managers
which has been tested in sub-Saharan Africa and is currently being
strengthened.
