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No company offers supporters of the Corporate Responsibility Initiative (Kovi) as many arguments as multinational commodities company Glencore with its global headquarters in Baar ZG. In the campaign leading up to the vote in late November, four of the six prominent examples of human rights and environmental violations come from Glencore and its subsidiaries.
Glencore is a world leading commodities trader and miner operating in third world countries with weak governments and legal systems. But Glencore was in the crossfire of criticism long before global dominance.
The 160,000-employee group, 850 of them in Switzerland, grew out of a trading company founded in 1974 in the canton of Zug by the legendary commodity trader and tax refugee Marc Rich († 78). The “King of Oil” was already doing dirty business in the 1980s when, despite the embargo, he was trading oil with the apartheid regime in South Africa.
Glencore headlines damage Switzerland’s reputation
With the stricter regulation and transparency requirements brought by the London IPO in 2011, Glencore definitely could no longer argue about politics and reputation. The secret was over.
However, the list of violations that non-governmental organizations (NGOs) report after extensive investigation has become longer and longer. With negative international headlines, Glencore is a risk to the reputation of Switzerland.
CEO Ivan Glasenberg (63) rarely reacts to criticism. It made an exception two years ago after a report on alleged human rights and environmental violations by Glencore at mines in South America. Glasenberg said: “We do not work unethically at any of our mines.”
Federal prosecutor investigates Glencore
However, suspicions of corruption and rights violations no longer only exist in development organizations. For example, the Swiss Federal Prosecutor’s Office has been investigating Glencore for corruption cases in the Congo since June. The US Department of Justice and British regulators are also investigating money laundering and corruption in several countries.
The Congolese investigations are related to dubious methods and dumping prices with which the Zug-based company is said to have obtained mining rights. The Congolese government first made big demands on the Katanga mining company, a Glencore subsidiary, for the mining rights to the copper mines.
But then the company sent dubious Israeli businessman Dan Gertler (46) to negotiate with the Congolese government. He managed to buy the mining licenses at a quarter of the usual price.
That Gertler paid bribes to members of the government is part of the process. He had already defamed for mining rights in a previous case. Relying on raw material income, the Congo has lost urgently needed income due to dumping.
Repeatedly dark payments
Glencore is also criticized for the Mopani copper smelter in Zambia. SRF’s “Rundschau” reported the emission of highly toxic sulfur dioxide and documented several deaths.
Glencore’s opaque payments for purchase rights in Chad’s state oil company also provide fodder for Kovi’s initiators. The Peruvian girl in Kovi’s cartels represents the case of a mine controlled by Glencore in Cerro de Pasco (Peru) that has poisoned the air and water with heavy metals.
Nickname “Lex Glencore”
Glencore recently responded that it had only been the majority owner of the mine for two years and that, among other things, it had repaired the water treatment and rehabilitated the zinc dumps. Previously, the company was owned by the state.
While Glencore has inherited some of the criticism, the company cannot entirely evade responsibility for the long list of violations. Not surprisingly, the corporate responsibility initiative has also been dubbed “Lex Glencore.”
Give in only to public pressure
According to critics of Glencore, the multinational commodities company has improved communications since it went public. They also welcome the publication of sustainability reports.
But Chantal Peyer of development organization Bread for All reveals the pattern of the raw materials giant: “Glencore does not acknowledge environmental pollution or human rights violations and almost always begins by denying the facts,” he says. Only the pressure of international public relations moves Glencore.
Glencore spokeswoman Sarah Antenore responded that human rights and the environment have been the focus of the sustainability strategy for years. “Unfortunately, part of the campaign is to spread misleading information about Glencore while ignoring the historical context,” he says.
