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Jobs threat over Morgan Stanley boycott

By Ian Fraser, Financial Editor

Sunday Herald

March 24th, 2002

A BOYCOTT over human rights issues in Asia could jeopardise Morgan Stanley’s plans toBanner at Morgan Stanley's 2002 agm increase the workforce at Cumbernauld, where it currently employs around 700 people.

Morgan Stanley recently confirmed it would create 450 additional securities support jobs in Glasgow.

Company employees in Cumbernauld and Glasgow are even being urged to speak out against the US bank’s role in funding controversial Asian projects which protesters say are devastating the environment and prompting major abuses.

The bank has underwritten bonds for the China Development Bank and the People’s Republic of China, in addition to underwriting the initial public offerings of Indonesian companies including Asian Pulp & Paper, Chalco and PetroChina.

Projects that the American bank is supporting in this way include China’s Three Gorges Dam, which is going to displace around two million people, and the controversial Golmud-Lhasa railway, which will open up large areas of Tibet to mining and population transfer as well as consolidating Beijing’s grip on the once independent region.

Many of these projects were so controversial that neither Britain’s Export Credit Guarantee Department nor the World Bank were prepared to lend them their support.

Lorne Stockman, environmental consultant to the Free Tibet campaign, said: “Morgan Stanley appears to be filling a niche in the market where other banks and organisations fear to tread.”

Morgan Stanley’s backing of Asian Pulp & Paper has contributed to the destruction of 300,000 hectares of one of the world’s richest and most diverse rainforests and the expulsion of indigenous peoples from their land, according to Friends of the Earth.

Alison Reynolds, director of the Free Tibet campaign said: “By underwriting these projects, Morgan Stanley is helping to finance destruction and oppression. It’s incredible that Morgan Stanley has not yet adopted guidelines to screen its investments for social impact. It’s time the company addressed this or it will face a growing consumer backlash.”

Craig Bennett, a corporate campaigner at Friends of the Earth, said: “Staff in Glasgow now have the opportunity to send a clear message to Morgan Stanley in the US.

“Their paymasters there are clearly totally out of tune with the UK public on these issues. Now’s their chance to help bridge the cultural divide.”

After being effectively stonewalled at Morgan Stanley’s annual meeting – which unusually was held in London’s Canary Wharf last week – some environmental and human rights campaigners believe they now have no option other than to launch a boycott of the company’s recently launched UK credit card, which is run from Cumbernauld.

Representatives from Friends of the Earth, the International Rivers Network and the Free Tibet Campaign questioned Morgan Stanley’s management of their environmental policies at the annual meeting.

After 15 minutes of speeches from the activists, Morgan Stanley’s chairman and chief executive Philip Purcell said: “We are working with various people on an environmental policy. We believe very strongly in the environment.”

But Bennett said: “Shareholders and customers expect more than that. It was just bland platitudes.”

Morgan Stanley’s UK credit card was introduced in September 1999 with some similar features to the Morgan Stanley’s Discover card in the US, which is already subject to a boycott by the International Rivers Network, based in Berkeley, California.

Morgan Stanley has issued around 600,000 cards to UK consumers.

Stockman said: “We have never had a satisfactory response from Morgan Stanley. Now we are talking about what to do next.”

Bennett said: “The response of any non-governmental organisation to a failure to respond is to increase the pressure.”

Copyright SMG Sunday Newspapers Ltd 2002

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