Scotmid claims to be ethical. This may apply to its food, but it doesn’t seem to apply to its banking!
I have just posted the following self-explanatory letter. If you like it please join the Facebook group: https://www.facebook.com/GetScotmidToBankEthically. Also consider signing this petition!
Mr John Brodie, Chief Executive
Executive Office
Scottish Midland Co-op Society
Hillwood House
2 Harvest Drive
NEWBRIDGE
EH28 8QJ
4 May 2012
Dear Mr Brodie
Congratulations on Israeli settlement decision./Changing your bank./FoI request.
I write to express both my appreciation for The Co-operative Group’s decision to extend the Human Rights and Trade policy to include trade with “any supplier of produce known to be sourcing from the Israeli settlements” and my profound disquiet over the fact that Scotmid banks with The Royal Bank of Scotland, an organisation with an Ethiscore of only 1.5 out of a possible 20.
You will no doubt have received many congratulatory emails and letters on the subject of The Co-operative Group’s praiseworthy decision to boycott suppliers sourcing their products from illegal Israeli settlements, so I won’t labour this. Instead, I shall point out that Scotmid’s choice of bank seems even more bizarre in light of this decision. Your Ethical Policy is clearly flouted by banking with the Royal Bank of Scotland (instead of, for example, The Co-operative Bank!) as you will quickly realise when you read the information I append, taken from the Move Your Money website ( http://www.moveyourmoney.org.uk/what-about-my-bank ). To mention just one example of the sort of project that RBS finances, I have heard first-hand from the leader of the Beaver Lake Cree of the horrific impact of the Alberta tar sands exploitation on the human rights of indigenous people and on the environment. You will know that the Beaver Lake Cree’s legal struggle is being supported by The Co-operative Bank and I refer you to their website for further information on this.
At Scotmid’s Edinburgh AGM on 30 April I was given to understand that the decision to bank with RBS was made for economic reasons. I would be grateful if you would confirm in writing why the decision was made and tell me what role, if any, ethical considerations played in it. Please explain what methodology, if any, you used to trade off ethical considerations against financial ones. I would also be grateful for copies of all correspondence on this issue in which ethics were mentioned. (Consider this a request under the Freedom of Information Act.) Alternatively, I would, of course, be delighted if the board would simply take action to change Scotmid’s bank to a considerably more ethical one. If you do not move to a more ethical bank you clearly open Scotmid to the charge of hypocrisy, and I think it is likely that you will face significant negative publicity and pressure from members and others.
I thank you in advance for your response to this.
Yours sincerely
Robert Eric Swanepoel (Dr), Member No. 187310
cc Mr Len Wardle, Co-operative Group Chair
Move Your Money
Friends of the Earth, Scotland
Royal Bank of Scotland (RBS)
RBS has an Ethiscore of 1.5 out of 20
This tax-payer-owned bank still seems to be struggling to pay its taxes operating in a huge number of tax havens. Its record on treating the tax payers of other nations is also pretty poor, with its links to various arms companies and environmentally disastrous projects.
Tax
ActionAid recently found that Royal Bank of Scotland Group had 1303 subsidiaries 31% of which were in tax havens including Jersey, Guernsey, Gibraltar and Isle of Man. ⇒ The company itself boasts on its website that it offers “a full range of services to international clients including investment and portfolio management; tax, trust and estate planning; and stockbroking. We also work with offshore corporates and financial institutions.”
Bonuses
In 2011 John Hourican, the head of the RBS investment bank received a £4.5m from an award of shares and options he received in 2009. ⇒ Sir Philip Hampton stood to receive up to £5.2m for shares he was awarded in February 2009 for taking on the role of chairman. Executive director Stephen Hester received a total of £3,267,000 in remuneration in 2010. ⇒
Environment
In 2011 RBS was named by the Ecologist as one the worst banks involved in financing fossil fuel companies. ⇒
- In March 2009, RBS provided £116 million in finance to Scottish oil company Cairn Energy. The finance was provided to help increase Cairn Energy’ s drilling operations in Greenland. The same month RBS financed Irish oil company Tullow Oil’ s operations in the sensitive Uganda-DRC border regions.
- In April 2007 RBS gave an estimated £1.2 billion corporate load to Gazprom, a Russian energy giant which has a majority stake in the Sakhalin Energy Investment Company (SEIC). Its vairous projects have been criticised for not consulting with indigenous communities and also threatening the last 120 critically endangered Western Gray Whales with extinction, as well as salmon which spawn in nearby rivers affected by the 800km of onshore pipelines.
- In August 2010 the Sunday Herald ran a front cover expose showing that RBS had provided nearly £13bn worth of finance to the oil and gas industries in the two years since it was bailed out by the UK public. ⇒
RBS’s involvement in the Madagscar tar-sands project was also criticised. ⇒ The bank had given more the £300 million in corporate loans to energy giant Total to explore the region. Campaigns from WDM claimed that over 120,000 people living in villages within the Bemolanga oil field will have their water supply disrupted and land poisoned as a result of the tar sands project while working conditions and treatment of workers were at the site were also condemned. It was also estimated that after 30 years of commercial production, the government of Madagascar will only be receiving four percent of the oil revenues. Ethical Consumer have called a boycott against Royal Bank of Scotland for its involvement in the financing of the tar sands projects in Alberta, Canada. ⇒ Tar sands extraction in Canada is devastating First Nation communities, wildlife and vast areas of boreal forests, as well as being many times more carbon-intensive to produce than ‘conventional’ oil. ⇒
The Bankrolling Climate Change report listed the top 20 banks which had been financing coal fired electricity and coal mining since 2005. ⇒ Royal Bank of Scotland was number seven on the list having provided 10,946 billion Euro of such finance over this period. ⇒ In May 2010 the report ‘Nuclear Banks – No Thanks’ listed RBS as having provided 8.576 billion Euro of finance to this sector between 2000 and 2009 – the sixth highest amount of all banking groups. ⇒
Arms and human rights
In October 2010, RBS was part of a banking syndicate that provided the American arms manufacturer Alliant Techsystems with a $1bn (£600m) five-year credit facility, with RBS itself loaning $80m. It has also underwritten $110.1m in bonds to Alliant Techsystems and Lockheed Martin. All the above were know to manufacture cluster bombs. ⇒
Earlier research from War on Want found that Royal Bank of Scotland Group plc (RBS Group plc) was a principal banker of a number of companies involved in the arms trade. These include BAE Systems, Rolls Royce, Babcock and Ultra Electronic. The bank also has shareholdings in a number of arms companies including: BAE Systems, Rolls Royce, QinetiQ, VT Group, Babcock, Ultra Electronic, and Chemring. ⇒
In 2011 the bank was also involved in a dubious networking event entitled “Middle East ‚Äì a vast market for UK defence and security companies”. Campaigners condemned the conference as evidence British arms companies were prepared to continue selling to authoritarian regimes in the Middle East despite the frequent use of both deadly and non-lethal weaponry to quell popular dissent during the Arab Spring. A flyer for the conference said that ‘the Middle East remains “one of the regions with the greatest number of opportunities for UK defence and security companies”. The publicity material, which featured an attack helicopter on its front, recommended Saudi Arabia, the UAE, Bahrain and Oman as lucrative clients that should be “targeted”. All four regimes tolerate little dissent and are frequently accused of gross human rights abuses. ⇒
The tax-payer-owned bank did sever relations with Belarus following a campaign by human rights groups Free Belarus Now and the Index on Censorship. Index said that RBS and other banks had sold $1.85bn (£1.1bn) worth of government bonds over the past year helping to support the regime of “Europe’s last dictator”. However the bank still has operation in a number of oppressive regimes including China, India, Kazakhstan, Russia and Thailand.
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