Online database brings transparency to mutual funds’ holdings in palm oil
by Brian Collett — An online database has been set up to show the global mutual funds with holdings in palm oil agriculture, today’s fastest-growing cause of rainforest destruction.
It will enable investors for the first time to discover links between their holdings and tropical deforestation and land grabs.
The investors will then be confidently placed to demand deforestation-free investment and responsible policies from retirement plans and other funds.
The transparency tool is the work of the environment group Friends of the Earth and As You Sow, a California-based organisation that promotes environmental and social corporate responsibility through shareholder action.
Friends of the Earth points out that 10 per cent of the farming of palm oil – which is used in more than half of all packaged products, from shampoo and toothpaste to instant noodles and doughnuts – is financed by equity investors, many of them mutual funds.
The environment group’s objections are that the plantations destroy rainforests, drive out orangutans, Sumatran tigers and other endangered species, and lead to social conflict and human rights abuses in many countries, including Liberia, Nigeria, Indonesia, Malaysia and Guatemala.
Andrew Behar, chief executive of As You Sow, said: “This web tool empowers investors to know exactly what they own so that they can pressure fund managers to implement sustainable investment policies and find investment options that support a forest-friendly future.”
Jeff Conant, senior international forests programme manager at Friends of the Earth, insisted that investors should not be misled.
He said: “When Americans put their hard-earned money in savings and retirement accounts, they believe they are preparing for a better future. But large asset managers undermine that very future, globally speaking, by putting this money into destructive agribusiness firms, generally through complex investment chains and failures in due diligence.
“Financial managers must stop investing in companies that grab land from subsistence farmers and indigenous people in order to install massive plantations with dangerous, low-wage labour.”
The database, which at present covers 6,500 global mutual funds, will eventually be spread to other investments in businesses that clear vital forests.
A Friends of the Earth report accompanying the database names the top ten US asset managers that invest in palm oil production. The list includes BlackRock, Vanguard, CalPERS, TIAA-CREF and Dimensional Fund Advisors.
The report shows that none of them has clear criteria for disclosing involvement in or avoiding businesses that destroy forests and ride roughshod over land rights.
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