Skip to content. | Skip to navigation

You are here: Home / News / Norwegian NCP publishes final statement in POSCO/ NBIM case

Norwegian NCP publishes final statement in POSCO/ NBIM case

May 27, 2013
Category:

The Norwegian NCP concludes that NBIM violates the OECD Guidelines chiefly on two accounts: First; by refusing to cooperate with the OECD NCP NBIM violates the OECD Guidelines Procedural Guidance. Second; by not having any strategy on how to react if it becomes aware of human rights risks related to companies in which NBIM is invested, apart from child labour violations.

On 27 May 2013, the Norwegian NCP published its final statement on the case filed against NBIM, the Norwegian Bank Investment Management. The complaint concerns NBIM’s investments in POSCO, a company responsible for various human rights violations at a proposed iron mine, steel plant and associated infrastructure in the State of Odisha, India. A parallel complaint has been filed against the Dutch pension fund ABP.

The Norwegian NCP affirms the stance taken by the Dutch NCP in the case filed against ABP that the Guidelines apply to fund managers and minority shareholders. 

The NCP concludes that NBIM violates the OECD Guidelines chiefly on two accounts: First; by refusing to cooperate with the NCP, NBIM violates the OECD Guidelines Procedural Guidance. Second; by not having any strategy on how to react if it becomes aware of human rights risks related to companies in which NBIM is invested, apart from child labour violations.

The NCP has experienced significant challenges in its work to achieve a constructive dialogue with NBIM. The NCP sent questions to NBIM related to whether NBIMs conduct is in line with the Guidelines, but NBIM did not provide a satisfactory response to these questions. The NCP claims this is particularly regrettable in light of the specific expectations that apply to state owned enterprises.

NBIM’s lack of an internal process to address human rights impacts is perceived as problematic by the NCP. The NCP further concludes that the lack of communication regarding NBIM’s approach to identifying and addressing human rights is problematic. The NCP finds that the NBIM’s Responsible Investor Policy and strategies are too narrowly focused and are therefore deemed not to be consistent with the Guidelines.

The NCPs recommendations include, as a minimum, that  NBIM,

-       Cooperates with the Norwegian NCP by responding to the NCPs questions related to whether NBIMs conduct is in line with the Guidelines, and accept the NCP offer to facilitate dialogue.

-       Expands human rights due diligence in connection with its investments to address the whole range of human rights that may be relevant to its investments

-       Identifies which human rights risks are prevalent in the various sectors or types of investments and develop a strategy to address these.

-       Publishes its strategy on human rights due diligence.

More specifically for the POSCO case, the NCP argues that, if the complaints are well-founded, NBIM should use its influence to persuade POSCO to strengthen its engagement with all stakeholders and to address their concerns. NBIM should request that POSCO prevent further impacts, mitigate those that are underway, and provide or cooperate in remediation where it has caused or contributed to human rights abuses that have already occurred, including by setting up an appropriate grievance mechanism.

Website: http://oecdwatch.org/cases/Case_262

Personal tools

OECD Watch is hosted by