Ethical Performance
inside intelligence for responsible business


investors get help identifying Iran links

December 2007

The SRI research provider KLD has introduced an Iran Compliance Service to guide insitutional investors and money managers whose clients wish to avoid investments in companies doing business in the country.

US-based KLD has found 36 publicly traded companies in 17 countries that do significant business with Iran, including the China Petroleum & Chemical Company, Shell and Total.

KLD said the service is a response to a new trend among US states to pass legislation barring their pension funds from investing in companies trading in Iran. It offers a similar compliance service for institutional investors wishing to divest or avoid investment in public companies conducting business in Sudan.

California, Florida and Illinois are among states to have passed Iran divestment legislation this year and others, including New York, Pennsylvania and Texas, are preparing to follow.  The California state pension scheme Calpers says it has $2billion (£980million) in holdings that may be affected by the California law, which comes into effect in June 2008.

The black marks that put companies on KLD’s list include having contracts with the Iran government that account for more than ten per cent of operations, and investments in Iran’s petroleum sector that generate at least $20m in any one-year period.

The divestment campaign has been led by what Time magazine has described as ‘an unusual alliance of big-state Democrats and Iraq war hawks’ keen to pressure Iran on its nuclear programme and terrorism links.

KLD has found no large US companies that at present meet its criteria for involvement in Iran.

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