A new report from Amnesty International together with the Fair Finance Guide, Still Irresponsible Investments – a study of Swedish banks’ investments in companies linked to human rights abuses, has concluded that Swedish banks continue to invest in blacklisted companies that violate human rights and contribute to serious environmental degradation.
The seven largest banks in Sweden continue to invest their clients’ money in such companies. These include: Danske Bank, Handelsbanken, Länsförsäkringar, Nordea, SEB, Skandia and Swedbank. The survey is a follow-up to a 2015 study investigating the issue, which also shows, however, improvement in terms of taking sustainability into account.
Among the companies identified on the Amnesty black list as being invested in by the banks are oil giant Shell and vehicle manufacturer Renault. Shell has failed to take responsibility for environmental disasters while Renault has been involved with the use of raw materials yielded from child labour in Africa.
The other companies on the blacklist are chemicals company Dow Dupont, mining company Goldcorp Inc., and mining company Vedanta Resources.
The report finds that a total of 62 of funds across the banks invest in non-sustainable companies, with Danske Bank, already embroiled in a considerable money laundering crisis, Handelsbanken, Länsförsäkringar and Swedbank even making such investments through funds designated as sustainable. No Nordic Ecolabelled funds were found guilty, however.
“It is a violation of the banks’ reported transparency guidelines to deal with companies that are linked to human rights abuses,” said Ulrika Sandberg, Business and Human Rights expert at Amnesty International Sweden in a press release accompanying the release of the report. “At the same time, we see improvements in terms of the use of internal resources on sustainability and improved impact investing.” SEB in particular was singled out for praise.
Nordea and Swedbank have the largest investments in these companies, at around SEK 4 billion. The seven banks combined have approximately 5.4 billion invested.
“Swedbank and Nordea have invested the most in the companies included in the review, but Swedbank has shown much better effort to put pressure on companies to get them to take responsibility,” Sandberg said. “This is about big global companies that have not taken sufficient action to address the fact that they contribute to serious negative impact on human rights and long-term environmental degradation.”
Among the advances highlighted in the report is the fact that all the banks have increased their resources dedicated to human rights work. Several of them have improved at trying to change company behaviour through dialogue and influence. However, among the many shortcomings are the lack of time-based targets for impact work and transparency of banks’s accounts of their activities. There are also shortcomings in terms of proactive work to identify risk before a potential scandal erupts.
“Banks have a continuing problem with living up to their sustainability promises. Customers must be able to trust that their money is managed responsibly and that banks act when the companies they’re invested in contribute to a negative impact on human rights and the environment,” said Jakob König, Project Manager for the Fair Finance Guide.