Christian Aid warns of lack of transparency in FTSE100 data
The secrecy surrounding thousands of subsidiaries created in tax havens by leading UK companies has created a black hole at the heart of the FTSE100, a new Christian Aid report has warned.
FTSEcrecy reveals an information void which, says the charity, threatens investors, customers and government regulators, because it leaves them without the facts they need to make good decisions about FTSE100 companies.
Christian Aid’s research found that FTSE100 companies have created 29,891 subsidiaries. But details of the subsidiaries’ turnover, assets, shareholder funds and number of employees are freely available in relation to only one-quarter (26 per cent) of them.
Such information is impossible to obtain, even for payment, in relation to a further 21 per cent of the subsidiaries (6,396 companies).
Data on the remaining 53 per cent of FTSE100 companies’ subsidiaries (more than 15,000) is available - but only on payment of a fee. These vary from the £1 that UK Companies House charges for annual reports and annual returns to more than US$10 per document permitted in some other jurisdictions.
Where information was not available from public authorities, Christian Aid found that it was sometimes available from fee-charging private databases of company information.
“We were shocked by how little information is freely available about most companies’ subsidiaries,” said Katharine Teague, co-author of the report, which reveals previously unpublished data about FTSE100 companies.
“What our findings show is that secrecy is not the exception but the norm, even among the largest 100 companies whose shares are traded on the London Stock Exchange.
“These are household-name firms in which millions of people invest, through their pension funds and savings. But the secrecy is so deep and widespread that it is like a blindfold on everyone who has financial dealings with these companies.”
The new research also highlights FTSE100 companies’ heavy use of tax havens. More than 90 per cent of their subsidiaries are based in places defined as ‘secrecy jurisdictions’ by the Financial Secrecy Index.
Almost half of those subsidiaries are in the UK (which is itself defined as ‘moderately secretive’). Of the remainder, 14 per cent are in ‘highly secretive’ tax havens such as Switzerland, Luxembourg, Hong Kong, Bermuda and the Cayman Islands.
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