One of the world’s largest institutional investors, the Norwegian Government Pension Fund, has sold all its 16 million shares of Malaysian timber giant Samling Global (3938.HK), worth about $1.2 million as a consequence of a groundbreaking decision announced Monday by the Norwegian Ministry of Finance.
The decision to exclude Samling Global from the Norwegian Government Pension Fund was made after a probe on Samling’s logging operations found the corporation responsible for systematic illegal logging in the East Malaysian state of Sarawak on Borneo.
The probe was conducted by the Government Pension Fund’s Council on Ethics and documented "extensive and repeated breaches of the licence requirements, regulations and other directives in all of the six concession areas that have been examined. Some of the violations constitute very serious transgessions, such as logging outside the concession area, logging in a protected area that was excluded from the concession by the authorities in order to be integrated into an existing national park, and re-entry logging without Environmental Impact Assessments."
The Norwegian Minister of Finance, Sigbjorn Johnsen, said that Samling’s forest operations in the rainforests of Sarawak and Guyana contribute to illegal logging and severe environmental damage, and he had therefore chosen to exclude the company from the government’s investment portfolio.
The Norwegian decision is a further blow for Sarawak’s controversial Chief Minister, Abdul Taib Mahmud. Taib is suspected to accept kickbacks from Samling in return for closing an eye on their illegal logging operations. It has recently become known that Taib secretly controls properties worth several hundred million US dollars in countries such as Canada, Australia, the UK and the US.
Samling is one of the companies that are responsible for the large-scale
logging of Sarawak’s primary rainforests and for the destruction of the
livelihood of the Penan and other indigenous communities. In 2007, it
was listed at the Hong Kong stock exchange with aid from Credit Suisse,
HSBC and Macquarie Securities Ltd.
The non-profit Bruno Manser Fund, which works to protect tropical rainforests, said it welcomes the decision by the Norwegian Government and calls on investors, finance institutions and timber traders worldwide to follow the Norwegian example and cut their business ties with Samling Global.
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