After more than three years embroiled in community conflicts, legal complaints, and violence, Tahoe Resources’ (Tahoe) controversial operations at its Escobal silver mine in Guatemala has cost the company a major investor: Norway’s sovereign wealth fund.
Last week, Norway’s Government Pension Fund-Global, the largest sovereign wealth fund in the world, announced it has divested from Tahoe. The 2014 annual report issued by the fund’s Council of Ethics explained its recommendation to exclude Tahoe Resources from the Fund, “due to an unacceptable risk of the company contributing to serious human rights violations.” Tahoe is currently facing two lawsuits for its human rights record at the Escobal mine. While publicly disclosed only this week, the Council’s recommendation was made in April 2014, and Norway’s central bank (Norges Bank) has already sold its stake in the company.
Norway’s divestment from Tahoe represents an ethical response to the mounting evidence of environmental and human rights harms surrounding the mine’s operation. In May of 2013, NISGUA and MiningWatch Canada published an investor alert discouraging financial backers from continuing to invest in Tahoe as a result of clear community opposition and heightened violence around the Escobal project, the company’s one and only mine. Since 2011, CIEL has hosted various urgent action campaigns to support local communities’ right to self-determination and justice.
Tahoe Resources first acquired the exploration rights to the Escobal project in 2009, and company analysts estimate that the project has the potential to become one of the largest silver producers in the world. Despite local community members’ expressed concerns over the environmental and social impacts of the mine, Tahoe began its construction in 2011. Since then, community groups, including the Committee in Defense of Life and Peace in San Rafael las Flores and the Diocesan Committee in the Defense of Nature (CODIDENA) have organized peaceful protests and community referendums, underscoring local opposition to the mine.
Tahoe Resources faces legal action in Guatemala for polluting local water supplies and allegations of violence against protesters. In addition, former Security Manager Alberto Rotondo is facing charges after wiretapping evidence surfaced that linked him directly to the shooting of unarmed protesters in April 2013.
Tahoe was founded in 2009 by Kevin McArthur, former CEO of Canadian mining giant Goldcorp, Inc. Goldcorp, whose Marlin mine in northwest Guatemala faces ongoing and repeated allegations of human rights violations and environmental damages, controls 40% of Tahoe’s shares.
NGOs now ask that Tahoe’s remaining investors follow Norway’s lead and divest as well. The project’s continuation threatens to exacerbate the ongoing militarization, criminalization, social conflict, and environmental degradation in the region.
Both the Canadian Pension Plan Investment Board (CPPIB) and the US-based Teachers Insurance and Annuity Association-College Retirement Equities Fund (TIAA-CREF) still hold a respective $39.4 million and $5 million USD worth of shares in Tahoe Resources.
In other exciting divestment news from Norway, under pressure from CIEL and others, the Norway Pension Fund-Global also announced this week that during 2014, it divested from 20+ companies with operations in coal mining, oil sands and coal-fired power production. Read more here.
Originally posted on February 7, 2015.