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Last update: 2016-05-02 00:00:00 BankTrack
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Glencore is listed on the London Stock Exchange, where it is traded as GLEN. Glencore’s senior executives and employees control 35.7 per cent of the company. CEO Ivan Glasenberg is the largest shareholder holding 8.3% of the shares.
Glencore plc (formerly Glencore Xstrata) is an Anglo-Swiss multinational commodity trading and mining company. The company was created through a merger of Glencore with Xstrata on 2 May 2013. It is one of the world's leading integrated producers and marketers of commodities and has a number of production facilities all around the world. It supplies metals, minerals, crude oil, oil products, coal, natural gas and agricultural products to international customers in the automotive, power generation, steel production and food processing industries. In 2014 it realised a turnover of USD221 billion and employed 130,000 people.
Human rights and social issues
Glencore recently dismissed 1,000 workers across three mines near Steelpoort, South Africa, following a strike that involved up to 1,500 workers. Protests stemmed from a dispute involving an employee who was allegedly assaulted by his superior.
The Glencore coal mines in Columbia are causing serious problems: human right violations, financing of paramilitary groups, massive conflicts with the unions and unionist who face multiple death threats.
Sagittarius Mines Inc. (SMI), a 62.5% subsidiary of Xstrata Copper, runs the Tampakan Copper-Gold Project on the Philippine island of Mindanao. Commercial production is set to begin in 2019. The project requires that 5,000 indigenous people be resettled. It puts community livelihoods at risk and threatens vital water sources. Despite ongoing community protests and a provincial ban on open pit mining, the Environmental Management Bureau (EMB) certified the project's environmental compliance in February 2013. Earlier, in October 2012, soldiers killed an indigenous woman, Juvy Capion, and her two sons belonging to the B'laan, a tribalgroup that opposes the project. A court case against them was dismissed in October 2013. SMI reportedly funds military and paramilitary forces in several communities around the mine.
The Peruvian community of Espinar is engaged in an ongoing dispute against Xstrata's Tintaya copper mine. Inhabitants allege that the mine has contaminated local water and soil with heavy metals. People believe that this contamination is linked to a recent increase in farm animal deformities. Multiple studies by private and state entities found elevated levels of contaminants including aluminum, arsenic, copper, iron, lithium, and manganese in water and soil samples. A study conducted by Peruvian state authorities, that included 12,500 samples, concluded that 2.2% of the samples were severely contaminated and 52.71% contained at least one parameter that exceeded official thresholds. In response to these findings, Xstrata cited the "natural background mineralization present in the region." Espinar's mayor, Oscar Mollohuanca, believes that the Tintaya mine is responsible for this contamination. Anti-mine protests in May-June 2012 resulted in two deaths and multiple injuries. Mayor Mollohuanca was among those arrested for disturbing the public order. Peru's prime minister, Oscar Valdes, labeled the protesters as extremists and declared a state of emergency in the region, stripping inhabitants of many of their basic rights for 30 days.
In August 2012 in South Africa, subsidiary Lonmin was involved in one of the most deadly police clashes since the end of apartheid. The South African Police Services used violent force to subdue protestors at Lonmin's Marikana platinum mine, killing 34 and wounding 78. Workers were protesting for higher wages. In September 2013, South Africa's Marikana Commission of Inquiry discovered inconsistencies and falsehoods in police accounts of the incident that suggested doctoring. The Commission is still performing its investigation, however, it has advised the South African Police Services to consult with their legal advisors.
In Columbia, due to environmental air pollution, Glencore Prodeco has to resettle three communities, but is heavily delayed in this task. Prodeco has diverted rivers with tremendous impacts, destroying livelihoods.
In June 2013, a Peruvian Glencore Xstrata subsidiary (33.75%), the Antamina copper mine, was fined USD77,000 for spilling 45 tons of toxic slurry into the neighboring community of Cajacay. The spill, which occurred in July 2012, caused extreme damage to the environment and poisoned around 350 residents, many of whom were children. Local inhabitants are currently considering taking legal action against the Antamina mine.
In 2011 it received an OECD complaint lodged by the Center for Human Rights and Environment (CEDHA), which remains unsettled. CEDHA claims that Xstrata's Argentinian operations have had severe environmental impacts on permafrost and glaciers in the area and will destroy rock glaciers and permafrost in the region by 2013 if the project progresses as planned. Xstrata denies the existence of any permafrost or glaciers in the area. The case has been transferred to the Argentinian court system where it has suffered extreme delays due to Xstrata's unwillingness to cooperate and setbacks within the court system.
The European Investment Bank suspended loans to Glencore over governance concerns, particularly in connection with allegations of tax evasion at Glencore's Mopani Copper mine in Zambia. Although the investigation is complete, the EIB has restrained from publishing the results despite holding to its decision to let the loans remain frozen.
In March 2013, Reuters reported that Glencore possibly violated international trade restrictions by providing raw alumina to an Iranian firm that supplies Iran's nuclear program "in a manner that circumvents sanctions." Glencore is also suspected of being involved in a price fixing scandal to artificially inflate the price of aluminum. The United States' Commodity Futures Trading Commission has issued a "do not destroy" order pending a formal investigation of these allegations.
Falcondo, an Xstrata subsidiary in the Dominican Republic, is accused of undervaluing the average price of nickel extracted from their Loma Peguera and Loma Ortega mine sites and failing to report their use of other metals, like iron and cobalt that make up their ferronickel alloy. Thus dodging around USD100 million in tax dollars owed to the Dominican Republic since 2007. A public complaint against Falcondo was filed in February 2013. Dominican Republic state officials halted another Xstrata mining project at the Loma Miranda site in June 2013 over environmental concerns.
In 2008, Glencore won the Public Eye Award for its irresponsible and opaque business practices in Colombia.
Glencore says seven dead after Congo mine-wall collapse last week
Katanga Mining, a majority-owned unit of global miner Glencore, said a collapsed wall at an open-pit mine in southeastern Democratic Republic of Congo had killed all seven people who were there at the time of the incident last week. The Swiss company, which has so far recovered three bodies from the site, said it had ended the search for the other four following a 10-day effort (source: Reuters).
S&P downgrades Glencore to just above junk
Standard & Poor's has downgraded Glencore's debt to one notch above junk, citing the "challenging outlook" for the mining industry and increasing uncertainty about demand from China, the world's biggest consumer of raw materials.