Hong Kong Watch research shows Canadian pensions invested in Chinese companies complicit in human rights abuses and with links to the PLA

Today, Hong Kong Watch is releasing a policy briefing paper looking at the extent of investment from three Canadian public pension funds into Chinese companies who are accused of complicity in human rights violations or have links with People’s Liberation Army and the Chinese state.

The briefing paper examined the investments of the British Columbia Investment Management Corporation, the Canada Pension Plan Investment Board, and the Ontario Teachers' Pension Plan Board in Chinese companies in 2020.

Hong Kong Watch, found that in 2020 they were investing in:

Chinese companies supporting the Myanmar military

Canadian pension funds have invested in companies that are destabilising the South East Asia region and Canada foreign policy interests. The Burma Campaign’s ‘Dirty List’ shows that several Chinese companies which receive investment from Canadian pension funds have close partnerships with the military in Myanmar, which has just launched a coup and is the process of an extremely violent crackdown on protests.

Chinese companies on the US sanctions list

CPPIB has C$156m invested in four Chinese companies on the US PLA entities list, including C$15m in the China Communications Construction Company, C$65m in China Mobile, C$19m in China United Network Communications, and C$57m in China National Offshore Oil Corp. BCI has C$217.34m invested in 9 Chinese companies on the US PLA entities list.

Hikvision

Hikvision is one of the principle Chinese companies that has helped construct the surveillance state and the camps that over a million Uyghurs in Xinjiang are currently detained in. It is therefore concerning that BCI is bankrolling this oppression through investing C$45.33m worth of Canadian pensions in Hikvision.

Chinese state-owned banks

Chinese state-owned banks are the largest bankroller of Chinese state-owned enterprises, who in turn have spent the last decade buying up a substantial amount of strategic infrastructure in the West, as well as being the largest lenders to the Belt and Road Initiative which has been accused of exploiting developing nations and being used as a tool for ‘debt diplomacy’.

BCI has C$106.4m of Canadian pensioners’ money in two Chinese state banks. China Construction Bank ($91.98m) and the Bank of China’s Hong Kong holdings (C$14.42m).

CPPIB has C$776m of Canadian pensioners money invested in five Chinese state-owned banks, including the Agricultural Bank of China ($42m), Bank of China ($16m), Bank of Communications ($2m), China CITIC Bank Corp ($3m), and Postal Savings Bank of China Co Ltd ($713m).

Tencent and Alibaba

Alongside Hikvision, Alibaba has produced facial recognition software that specifically targets Uyghurs and has helped construct the surveillance state and camps that over a million Uyghurs are currently detained in.

Tencent and its subsidiaries have produced a number of bespoke technology products for the Chinese Government which censors mentions of the Uyghurs and Xinjiang on the Chinese internet and surveils users. The media company has also signed agreements with the Ministry of Public Security to promote “the influence and credibility” of police departments nationwide.

The Ontario Teachers' Pension Plan Board has C$943.9m invested in Alibaba and Tencent, BCI has just over a billion invested in Alibaba and Tencent, and CPPIB has C$5.327bn invested in Alibaba and Tencent.

The briefing paper recommends that:

1.       Canadian parliamentarians should begin to view Canadian investment into companies complicit in human rights violations as an ESG issue.

2.        Canadian parliamentarians should encourage the Government to create an entities list of companies where there is evidence of complicity in crimes against humanity and human rights abuse.

3.       3. Canadian parliamentarians should work to task the Financial Consumer Agency of Canada through primary legislation to design rules to restrict investment in companies with particularly egregious records of complicity in human rights abuses.

4.       4. Canadian parliamentarians should push the Government to ensure there is a ban on public pension funds being invested in Chinese companies who are complicit in the persecution and enslavement of the Uyghurs and the Tibetans, as well as the crackdown in Hong Kong.

The full report can be read here

Update

Following the publication of this report, the CPPIB released the list of its investments in 2021. Hong Kong Watch has found that the:

  • CPPIB continues to invest heavily in Alibaba (C$2.787bn) and Tencent (C$4.398bn).

  • CPPIB continues to invest in Chinese state banks, including the Bank of China (C$14m), China Construction Bank Corp (C$66m), Bank of Communications (C$2m).

  • CPPIB continues to invest in companies on the US sanctions list, including China Shipbuilding Industry Group Power Co (C$3m).

Reference: https://cdn2.cppinvestments.com/wp-content/uploads/2021/05/Foreign-Publicly-Traded-Equity-Holdings_ibfs_EN_Q4F21_v2.htm

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