We Don’t Want your Dirty Money
Five Swiss villages rejected a tax windfall from a commodities corporation, voting instead to donate it to the countries harmed by the corporation’s ruthless production methods. Read More
Because of its exploitive business practices, some Swiss villages have declined to keep millions in tax income from commodities giant Glencore, and have voted to donate a percentage instead. This public pressure has already borne fruit, and inspired the corporation’s CEO to visit the company’s production sites personally, where he promised improvement.
We have probably all felt angry about some of the negative consequences of the global economy. Such as the fact that our clothing is sewn in unacceptable conditions, or that the raw materials in our mobile phones come from conflict mines. Our consumption of oil drives wars, our meat comes from factory farms, and our greenhouse tomatoes are depleting the soil. Large corporations seem to care about nothing at all except their bottom lines. And what’s worse is that we are somehow part of the system, whether we like it or not. Not only do we buy the products; we also profit from the tax revenues paid by local corporations.
On our own, we can’t do much, since global corporations are not particularly interested in what one individual citizen finds morally reprehensible. But perhaps there is a way forward, as five tiny Swiss villages showed last year.
Anyone outside of Switzerland has probably never heard of the villages of Hedingen, Obfelden, Hausen, Affoltern am Albis, and Mettmenstetten before. Home to just a few thousand people, all are located in the Canton of Zurich in a rural region between Lake Zug and Lake Zurich. The villagers are neither revolutionaries nor left-wing opponents of globalization. In fact, the national-conservative Swiss People’s Party tends to win the day here. Yet these Swiss villagers have effectively demonstrated how to resist a giant corporation, and how to opt out of benefiting from exploitive business practices.
Each village was free to decide how the money should be spent.
It all began in 2012, when the communities received a unique windfall from a neighbor. Ivan Galsenberg, CEO and co-owner of Glencore Xstrata, one of the largest commodity companies in the world, lives in the village of Rüschlikon, also in the Canton of Zurich. When Glencore went public, Galsenberg had to pay around 360 million Swiss francs in taxes to the Canton of Zurich, roughly 335 million euros or 360 million US dollars. The income was divided among the villages in the canton, who suddenly found their coffers overflowing. Each village was free to decide how the money should be spent.
Over the years, Glencore had been the subject of a lot of vocal and public criticism for its business practices. The company has repeatedly been accused of exploiting its workforce, polluting the environment, and engaging in corruption in politically weak nations. In 2008, it even had the dubious honor of receiving the “Public Eye Award” by Swiss NGO Public Eye, which names and shames corporations with the worst human rights and environmental records.
Rather than keep the dirty money, they suggested returning some of the proceeds to the production countries from whence it came.
So the villages were faced with the question of how to spend their new-found, but possibly sordid fortune. The 3,500-person village of Hedingen, recipient of around one million additional francs in Glencore tax income, took the first step. A citizen’s action group presented a plan to the local council: Rather than keep the dirty money, they suggested returning some of the proceeds to the production countries from whence it came. It was put to a popular vote, and the Hedingers agreed to donate ten percent of their windfall. Some spoke in favor of donating it all, but this would have proven difficult to push through. So around 110,000 francs went to aid projects in the African and Latin American countries in which Glencore operates. The projects help local inhabitants take large corporations, like Glencore, to court, for example. They provide smallholder farmers in the Congo with access to land, and support rural communities in Columbia who have been ejected from their villages by coal mining.
The initiative described contributions as “a show of solidarity to benefit those who have been harmed by the mining of raw materials.” Four more villages jumped on the bandwagon, and together gave away a total of almost 400,000 francs. Glasenberg responded by writing to the villagers, and trying to convince them they’d gotten the wrong end of the stick about Glencore’s business practices. But they stood by their decision.
In purely financial terms, this small effort was certainly not enough to save those who had been harmed, nor did it end the untenable conditions in the mining areas. But the example set by the villages attracted the attention of the media, which snowballed into pressure that did create change.
The citizen’s action group continued their efforts, and three years later decided to visit a few of the projects they had helped fund. They decided to visit Colombia, where Glencore had repeatedly been accused of human rights violations. Tales of unionizers receiving death threats, villagers driven from their homes by coal mining, and coal dust poisoning the environment were not uncommon. At the beginning of January 2015, seven activists made the trek to Guajira and Cesar, the heart of Colombian coal mining country, to see for themselves. They travelled to relocated villages, talked to workers and unionizers, and visited the local Glencore offices. After returning to Switzerland, they drafted a 50-page report about their own personal observations of what was taking place in the production facilities and sent it to Glencore.
CEO Glasenberg responded right away – and decided to make the trip himself as well to see exactly what was going on. He asked two members of the citizen’s action committee to join him in Colombia that same year. So in March, they boarded another airplane, accompanied by the Glencore sustainability team, two additional managers, and representatives of NGOs.
In terms of its impact, the trip was a huge success: for the first time, Glasenberg visited the villages around the Glencore mines and heard first-hand about the problems his company was responsible for. He talked to representatives from Pensamiento y Acción Social, a Colombian NGO that fights for the rights of local inhabitants, and ultimately promised that Glencore would discuss any new relocation plans and involve locals in the planning process. He assured the people of one relocated village that he would personally see that they got a reliable source of water. And Glencore has already brought the UN on board for its next relocation projects.
Just how many of these promises and plans translate into reality remains to be seen. Nonetheless, the Swiss villagers have achieved more than they could have imagined at the outset. They inspired the CEO of one of the largest commodities companies in the world to take a closer, more serious look at social and environmental issues, and promise improvement. “Having the CEO personally engage with these problems is a huge success for our action group,” Silvia Berger said after returning from Colombia. “Now we want to see him turn talk into action.”