Individuals must take the actions that they can to help

Although there may be few actions that individuals can take, one area in which each person can take action is how their money is invested, and how the organizations with which they affiliate invest their money.

If Fidelity customers can affect Fidelity's policy, Fidelity can have a significant impact on the Chinese oil companies operating in Sudan, and in turn, on the government of Sudan.

If large numbers of citizens and Fidelity customers speak loudly, that message will be heard, not only by Fidelity, but also by the Chinese oil companies operating in Sudan and the government of Sudan.

Fidelity's SEC filing on May 15, 2007, and the attendant press coverage shows that our combined voices can have an impact.  Click here for more. 

Summary of why citizens and investors should take action against Fidelity

  • Sudan and its government-sponsored Janjaweed militia have committed pervasive violations of human rights in Darfur, Sudan, since early 2003, earning the designation of the first genocide of the 21st century.
  • The atrocities taking place in Darfur, Sudan, have been identified as genocide by unanimous declaration of Congress in July 2004, by two Secretaries of State, and by the President of the United States.
  • The genocide in Darfur has resulted in the deaths of hundreds of thousands and the displacement of millions of Darfurians, and is continuing to claim victims.
  • There is a well-established link between the oil industry in Sudan and the revenue of the Government of Sudan which overwhelmingly goes to increased arms and funding of the genocide in Darfur.
  • Fidelity, through its mutual funds, has been a major investor in two of the largest oil companies operating in Sudan, PetroChina (through its parent CNPC) and Sinopec (aka China Petroleum).
  • Until December 31, 2006 Fidelity had been significantly increasing its holdings in these tainted companies.
  • As of December 31, 2006, Fidelity had been the largest holder of PetroChina on the New York Stock Exchange.   Counting Fidelity's holdings around the world, Fidelity owned 5% of the outstanding shares of PetroChina, worth $1.3 billion, as of their February 14, 2007 SEC filing.  For a current view of their holdings in PetroChina and Sinopec, click Fidelity's Holdings. 
  • PetroChina's closely related parent, CNPC, is Sudan's largest partner in the oil industry there. We hold PetroChina accountable, just as we would CNPC, since the "separation between these two companies is largely cosmetic" and they "should not be rewarded" for creating distinctions on paper to obscure their connections to the genocide.
  • US law prohibits American companies from doing business in Sudan, yet Americans are legally able to invest in foreign companies operating in Sudan. Over the last two years, many large investors, including US colleges and states pension funds, have made the responsible decision to divest from PetroChina and Sinopec.
  • This is not the first time people have raised concerns about the impact of Fidelity's investments. In the years before the genocide in Darfur, Fidelity stubbornly held on to its investments in Talisman Energy, while genocide and large scale slavery spurred public protests and 2 million people were killed in South Sudan, even though other major investors and financial institutions divested.
  • Fidelity was unresponsive to the concerns detailed in our formal inquiries and requests, made clear in a series of five letters since the end of September 2006, delivered to 51 Fidelity executive management, trustees, board members, and fund managers.  Fidelity's sole response had been a form letter thanking us for our interest, saying that everything they do is legal, and emphasizing that their only concern is their fiduciary responsibility.
  • In response to widespread recognition of the problem of their tainted investments in PetroChina and Sinopec plus thousands of citizen complaints, Fidelity began to take action in the first quarter of calendar 2007.  Fidelity's action in early 2007 is a good start, but there is much more to do.  For a current view of their holdings in PetroChina and Sinopec, click Fidelity's Holdings.
  • Fidelity's SEC filing on May 15, 2007, and the attendant press coverage shows that our combined voices can have an impact.  Click here for more.
  • Millions of Americans are customers of Fidelity and have money entrusted to them. We can and should expect better from a trusted advisor.   Who wants to support a company which insists on investing in companies which help fund genocide?
  • Looking back, who would support the idea of investing in firms that sought to make a profit by selling Zyklon-B gas to the Nazis or machetes for the genocide in Rwanda?  Looking forward, who wants their personal savings and pension funds invested in companies that help fund the genocide in Darfur?

Some of the good things that can happen as a result of citizens and investors complaining to Fidelity and moving their money

  • Many people complaining will increase public awareness of the problem with Fidelity and increase awareness of the genocide in Darfur and the need to help.
  • Fidelity may feel the pressure and take constructive action to influence the Chinese oil companies and the government of Sudan, using its large investment position as leverage.
  • Fidelity may feel the pressure and might divest.
  • Other institutional investors may see the pressure on Fidelity and therefore be influenced to divest from PTR and SNP or to avoid investing in those companies.
  • Increased awareness of the problem may result in getting Congress to change the law, so that US capital can not be used to help Sudan fund the genocide in Darfur. Note that US law already prohibits nearly all US companies from operating in Sudan, for just that reason.
  • Fidelity may give more consideration to ethical issues before making investments in the future.
  • People can free themselves from any ethical concerns they have about Fidelity's connection to the Sudan oil industry.

Eric Reeves' testimony

Professor Eric Reeves made the case for divesting from Sudan in his testimony at a recent hearing for the Massachusetts state pension divestment bill:

To be sure, there will be some who offer a form of “slippery slope” argument: “genocide in Darfur is certainly horrific, but divestment is not a strategy that we can endorse as a matter of law---we can’t ethically screen our investments without risking making every political cause a potential occasion for a divestment campaign. The purpose of state-controlled funds is to secure the maximum return on investment, not to change the world.”

But the answer to this “slippery slope” argument is what I might call the “threshold argument.” It asks: “Is there no threshold beyond which we do begin to screen our investments on a political or moral basis? What about a hypothetical Swiss company that in 1944 was shipping Zyklon-B (Prussic acid) to the Nazis, for use in the death camps? What if this Swiss company traded on the New York Stock Exchange, and benefited from US capital investment? Does anyone claim that under such circumstances it would not have been morally obligatory for Massachusetts to divest from any holdings in this hypothetical company?”

But how is the present situation different? Companies like Germany’s Siemens, France’s Alcatel, Switzerland’s ABB Ltd., and China’s PetroChina and Sinopec---all of which trade on the New York Stock Exchange and are found in a great many portfolios with international exposure---help sustain a genocidal government in Khartoum by means of massive capital and commercial investments. Given Khartoum’s overwhelming external debt, these investments are a financial lifeline---the essential supplement, economically, to the oil wealth that the National Islamic Front has devoted in profligate fashion to military purchases and to genocide as a domestic security policy. Why are investments in Siemens, Alcatel, ABB Ltd., PetroChina, and a great many others acceptable by the Commonwealth of Massachusetts?

I must argue that massive ongoing genocidal destruction---what we are witnessing in Darfur according to the US Congress and the most senior officials of the Bush administration---should incinerate concerns about inappropriate precedents. Corporate complicity in the ultimate human crime should always be an occasion for divestment.

Perhaps a few, even stipulating genocide and corporate complicity in that genocide, will argue that the Commonwealth must be concerned only about its fiduciary responsibility to the citizens of Massachusetts. But such fiduciary responsibility certainly entails taking cognizance of the potentially devastating effects on share-price of a successful divestment campaign. During a similar divestment campaign against Canada’s huge Talisman Energy---a campaign animated by the company’s clearly demonstrated complicity in the genocidal clearances of the oil regions of southern Sudan---Talisman share price declined by 35% according to Canadian oil analysts. This example demands current fiduciary attention, given the rapidly growing national strength of the Darfur divestment campaign.

Morally and financially, Darfur presents a case for divestment that could not be more compelling.