Genocide-free investing
Years after the genocide in Darfur was publicly acknowledged, millions of people are unknowingly and inadvertently investing in the companies that are funding this genocide. Investors entrust their family savings and pension funds to mutual fund and other investment firms, which in turn invest those savings in companies which help to fund genocide.
A broad base of major financial institutions invest in a small set of problem companies, particularly PetroChina. When confronted with this problem, these investment firms ignore the moral issue of investing in genocide.
Once they become aware, people are overwhelmingly opposed to being financially connected to genocide. Studies done in 2010 and 2007 by KRC Research highlight the overwhelming support by the American public for genocide-free investing:
- 84% of respondents say they will withdraw their investments from American companies that do business with companies that directly or indirectly support genocide.
- 88% would like their mutual funds to be genocide-free.
- 95% of those earning $50,000 or more would like their mutual funds to be genocide-free.
- 82% say they would advise friends, family and co-workers against buying products or services, or investing in American companies that invest in a foreign company that directly or indirectly provides revenue to a government that perpetrates genocide.
Reasonable people may disagree about what constitutes socially responsible investing, but few people want their savings to be complicit in genocide.
Join us in asking mutual funds and other investment firms commit to genocide-free investing.
- Click here to learn about our shareholder proposal campaign to advance genocide-free investing
- Click here to see mutual funds that have a genocide-free investing proposal pending
- Click here for a brief history of of genocide-free investing
- Click here for a one page flyer on the campaign for genocide-free investing
Making a commitment to genocide-free investing
We want mutual funds and investment firms to make a commitment to genocide-free investing. The key section of our genocide-free investing shareholder proposal submissions says:
- Shareholders request that the Board institute transparent procedures to prevent holding investments in companies that, in management's judgment, substantially contribute to genocide or crimes against humanity, the most egregious violations of human rights.
Why we need commitment to genocide-free investing
- Financial institutions such as mutual funds companies are major
investors in oil companies, such as PetroChina, that are the worst
offenders involved in Sudan and helping to fund the genocide in Darfur. Click here for more information about these problem companies.
- As a result, ordinary investors, through their mutual funds, family savings, and pension plans entrusted to these financial institutions, are inadvertently investing in genocide.
- When confronted with the problem of investing in genocide, many investment companies ignore the moral issue, accepting no principle governing their investments beyond financial returns and obeying the law, and resisting any limitations on their flexibility to invest, even when they know that companies are substantially contributing to genocide.
Why fundamental changes are needed
Investors face multiple hurdles when attempting to make genocide-free investments. Few people research the details of their mutual funds; they simply trust their investment company to make sound choices on their behalf. Individual investors who do attempt this research discover that it is a daunting task to determine which companies have ties to genocide, so that they can avoid those companies. Further complicating the task are the facts that even “recent” reports of a fund’s portfolio holdings are likely to be months out of date and individuals have no assurance that their mutual fund managers will not invest in the problem companies in the future. In the case of 401k investments, individuals are limited by the number of funds offered in their 401k plan and may have no good options. When available, investors might choose Socially Responsible Investment (SRI) funds, but these are not offered by most 401k plans and also are more limited in the diversity of their offerings. Lastly, investors who would like to choose low-priced index funds are severely limited, since the international and emerging markets indices often include even the worst offending companies.
The challenge is to make the market for financial investments more responsive to the American public’s interest in not being complicit in the most egregious violations of human rights.
Q & A
- What is the connection between financial investments and genocide today?
One of today’s worst human rights crises is in the Darfur region of Sudan. The US government has called this crisis the first genocide of the 21st century – the only case of the US government formally recognizing a genocide while it was occurring. The crisis in Darfur has sparked a broad-based anti-genocide movement in the US. Sudan and its government-sponsored Janjaweed militia have committed pervasive violations of human rights in Darfur, Sudan, since March 2003. The government of Sudan has continued to pursue genocide in Darfur, using 70% of its oil revenue to provide arms and funding for the genocide, rather than economic development for the poor people of Sudan. Although federal law prevents most US companies from operating in Sudan, American financial institutions, in particular mutual fund companies, are major investors in the Chinese, Indian, and Malaysian oil companies which are helping to fund this genocide.
More than seven years after the genocide began, while the crisis grew and the death toll mounted, major investment firms continued to invest, and often increased their holdings, in the worst offending companies helping the government of Sudan fund the genocide. Financial institutions such as Fidelity, Franklin Templeton, and Vanguard are major investors in the worst oil companies providing the funds the Government of Sudan needs to carry on the genocide in Darfur. These problem companies are PetroChina (China), Sinopec (China), ONGC (India) and Petronas (Malaysia). The case against these companies is straightforward and widely recognized. This small list of problem companies makes it easy for mutual funds and other investment firms to demonstrate their commitment to doing the right thing. Few individuals invest in these worst four oil companies, but many investment firms have large holdings. Since individual investors trust their family savings to these investment firms, the large holdings of PetroChina, Sinopec, ONGC and Petronas are problems for many millions of Americans. - Is “active engagement” consistent with "genocide-free investing"?
Genocide-free investing requires companies to avoid future investments in companies that contribute to genocide. For companies with existing investments in problem companies, there are two acceptable options. If the holding is substantial enough that the shareholder could influence the problem company’s management to work toward an end to the genocide and the company is receptive to active engagement, then this course of action may be appropriate. If the holding is relatively small or the company does not respond quickly to efforts to engage, then the shares should be sold. - Who is proposing "genocide-free investing"?
Investors Against Genocide is dedicated to convincing mutual fund and other investment firms to change their investing strategy to avoid complicity in genocide. In particular, we want investment firms to avoid or divest holdings of PetroChina (Chinese), Sinopec (Chinese), ONGC (Indian), and Petronas (Malaysian), the four major oil companies that are partnering with the Government of Sudan and helping to fund the genocide in Darfur. We work with individuals, companies, organizations, financial institutions, the press, investment firm employees, and government agencies to build awareness and to create financial, public relations, and regulatory pressure for investment firms to change. The ultimate goals are that investment firms make a commitment to genocide-free investing and that the Government of Sudan ends its deadly genocide in Darfur. Investors Against Genocide is a project of the Massachusetts Coalition to Save Darfur Inc., a 501(c)(3) charitable organization.