Big corporations with financial stakes running into billions of dollars are closely tied to Myanmar’s military junta, says a financial investigation by rights groups.
An investigation by rights groups has revealed that environmental, social and governance (ESG) investments have funnelled billions into companies arming, funding and legitimising the Myanmar military junta.
Big corporations with financial stakes running into billions of dollars are closely tied to Myanmar’s military junta, says a financial investigation by Inclusive Development International and ALTSEAN-Burma, the findings reveal.
Their report, “The Myanmar ESG Files: How ‘responsible investment’ is enabling a military dictatorship,” by the human rights advocacy groups documents how hundreds of ESG (Environmental, Social and Governance) funds reflect in the shares in 33 corporations linked to the military junta. Implicitly, the corporations and the ESG funds have enabled the regime’s grip on the country.
Myanmar’s military junta has been accused of overthrowing a representative, democratic government in February 2021 and crimes against humanity.
“Funds carrying the ESG label hold at least $13.4 billion worth of shares in 33 companies linked with the Myanmar military,” says the group’s findings.
Some $40 trillion of professionally managed assets globally consider ESG factors. That is on track to exceed $53 trillion by 2025. With fees for ESG funds typically higher than conventional funds, consumers have been willing to pay a premium for these products.
This “sustainable investment” received by big business in the strife-torn country includes weapon dealers supplying arms to the regime and tech services serving the military-controlled national police force and aid the government’s surveillance over its opponents and violently crush dissent.
“Activists on the ground have been risking their lives and liberty to stop the flow of money, weapons and other resources that has allowed the military to maintain its illegitimate grip on power,” said Debbie Stothard, founder and coordinator of ALTSEAN-Burma. “It’s shocking and devastating to see so-called ‘responsible investment’ doing the opposite.”
According to data compiled by Inclusive Development International, ESG-labelled funds continued to hold shares in these companies even after Myanmar’s military was found involved in the genocide perpetrated against the Rohingya. Similarly, the companies held the shares after the bloody coup and subsequent crackdown on pro-democracy protesters in February 2021.
“That dozens of companies with ties to Myanmar’s genocidal regime are included in ESG portfolios shows just how large the gulf is between ‘responsible investment’ marketing claims and reality,” said David Pred, executive director of Inclusive Development International. “The foundation of this fraudulent industry is a deeply flawed ESG ratings system, which is in urgent need of regulation.”