Press Release / Dec. 12, 2013

Credit Suisse ignored human rights commitments and became major shareholder in Vietnamese rubber giant 2 weeks after land grab scandal

Credit Suisse became the largest institutional shareholder in Vietnamese rubber giant Hoang Anh Gia Lai (HAGL) just two weeks after Global Witness exposed a range of environmental and human rights abuses in the company’s plantations in Cambodia and Laos. Such action is in direct contravention of Credit Suisse’s commitments to human rights, the campaign group revealed today (1). The disclosures come as another investor confirmed it had divested from HAGL as a result of the Global Witness findings (2).  

On 13th May 2013, Rubber Barons detailed how HAGL was routinely bulldozing local communities’ land and clearing large areas of intact forest in Cambodia and Laos to make way for its plantations (3). The report also revealed how a range of investors including CBR Investments, Deutsche Bank and the International Finance Corporation (the private investment arm of the World Bank) held shares in HAGL. Swiss-based CBR Investments divested within days of the report’s publication.

Christian Rosenow, CEO of CBR Investments Ltd, said to Global Witness: “We managed a fund which had HAGL as one of its larger investments. After hearing reports of HAGL's actions in Cambodia and its failure to abide by environmental, social and corporate governance principles in Cambodia, we sold the entire position in HAGL. This took place within a few days of your report being made available.”

Despite extensive media coverage of the findings, on 28th May 2013 Credit Suisse swapped bonds it held in HAGL to acquire more than 10% of the company’s shares – making it the second largest investor after HAGL founder and chairman, Doan Nguyen Duc (4).

“This is very worrying. Credit Suisse became a major shareholder in HAGL just when any responsible investor would be blacklisting them,” said Megan MacInnes from Global Witness. “What kind of checks can Credit Suisse have done if it thought this was a good time to provide finance to a company like HAGL?”

Global Witness contacted Credit Suisse in June 2013 and was told that the bank was legally obliged to keep HAGL’s shares for a minimum of 12 months. The bank subsequently confirmed that it had undertaken due diligence checks on HAGL’s operations prior to purchasing the bonds, and that “no specific concerns were identified at the time”. No further due diligence was carried out prior to the bond-for-share swap.

This contrasts starkly with Credit Suisse’s position following previous exposures of its financing of human rights abuses in 2011, when it stated “we pay particular attention to companies operating in industries where activities may, for example, infringe on the rights of local communities or indigenous peoples” (5).

MacInnes added, “Credit Suisse talks a good game, but it’s actively enabling the land grabbing crisis that’s sweeping across Cambodia and Laos by financing this company. The bank trades heavily on signing up to ethical initiatives like the UN Global Compact and the Equator Principles, so why is it profiting from the misery of those who’ve lost their land and forests to HAGL?”

Since August 2012, Global Witness has made repeated requests to HAGL to bring its operations in line with local law, resolve disputes with affected communities and publicly disclose details of its concessions. Despite making a range of commitments since the report was launched, Global Witness’ consultations with villagers affected by the company’s concessions indicate that very little has improved on the ground.

On 13th November 2013, HAGL refuted there was a lack of progress and described Global Witness’ information as “untrustworthy”(6).

Global Witness is calling for Credit Suisse to review its due diligence processes to ensure its investments fund fair and sustainable development models rather than land-grabs and deforestation.


Contact: Oliver Courtney, [email protected], +44 (0)7912 517147.

Notes to editors:

(1)   Credit Suisse website says it adheres to the UN Global Compact, the International Bill of Human Rights and The Equator Principles: see here for more.

(2)   In an email to Global Witness dated 29 November 2013, a representative of CBR Investments Ltd stated: “In April, we were given the mandate for another fund, which had HAGL as one of the largest investment positions. We advised the manager of the fund which engaged us as their Vietnam advisor that we recommend to exit that position, because we heard reports of their ESG sins in Cambodia. We sold their entire position within a few days of your report having been made available.”

(3)   See here for more information:

(4)   Global Witness became aware of Credit Suisse’s shareholder involvement in HAGL in June 2013. However, until now the organisation has been involved in a six-month period of direct engagement with HAGL to address the social and environmental problems associated with its concessions in Cambodia and Laos. As outlined in a statement issued by Global Witness on 14th November 2013, no significant improvements have been achieved on the ground and as a result the organisation recommended HAGL’s investors divest.

(5)   An excerpt from a statement made by Credit Suisse on 19th July 2011 in response to the Swiss NGO Berne Declaration

(6)   When questioned by Global Witness on 13th November 2013, HAGL refuted the lack of progress made towards its commitments to change. The company stated it had provided jobs and implemented economic and social development projects (including building roads, houses and hospitals), but that the monsoon and Cambodia’s national election had prevented the company from accessing affected communities. HAGL claimed that their moratorium on logging was being followed, describing the satellite evidence provided by Global Witness as “untrustworthy”. In addition, HAGL says it is “looking for an independent consulting firm to help HAGL make the survey and give advice to HAGL to improve the issues related to the communities” but that such consultants must be accompanied by company staff in order to “assure the consultant’s independency of their findings”.