Corporate Watch, Author at Corporate Watch https://corporatewatch.org/author/cw5/ Thu, 17 Aug 2023 08:06:43 +0000 en-GB hourly 1 https://corporatewatch.org/wp-content/uploads/2017/09/cropped-CWLogo1-32x32.png Corporate Watch, Author at Corporate Watch https://corporatewatch.org/author/cw5/ 32 32 The Carbon Profiteers: meet the investors running – and destroying – our world https://corporatewatch.org/the-carbon-profiteers-meet-the-investors-running-and-destroying-our-world/ Tue, 15 Aug 2023 16:00:10 +0000 https://corporatewatch.org/?p=12675 As part of our investigation with Queen Mary University’s Centre for Climate Crime and Justice into the mammoth payouts made to BP and Shell’s shareholders, we examined the top eight investors of both oil companies, breaking down these faceless, murky entities as best we can. All eight are hugely powerful corporations, holding shares in many […]

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As part of our investigation with Queen Mary University’s Centre for Climate Crime and Justice into the mammoth payouts made to BP and Shell’s shareholders, we examined the top eight investors of both oil companies, breaking down these faceless, murky entities as best we can. All eight are hugely powerful corporations, holding shares in many companies listed on the world’s stock exchanges.

We contrast the voluminous quantities of greenwash they spout, often facilitated by the mainstream media, with the stark reality of their profiteering.

Meet the investors running – and destroying – our world.

Contents:

#1. BlackRock

#2. Vanguard Group

#3. Norges Bank Investment Management (NBIM)

#4. Legal & General Investment Management (LGIM)

#5. UBS Asset Management

#6. State Street Global Advisors (SSGA)

#7. Safe Investment Co.

#8. abrdn

Note: For more on our sources, please see the full report here.

 

#1: BlackRock

BlackRock, Inc. is an asset management company, investing money on behalf of its clients in return for fees. It controls approximately $8.5tn (£6.7tn) in investments, making it the largest asset manager in the world – a position it has held since 2009. It is also the largest index investor, with two thirds of its assets in passive funds. Headquartered in the US, it has around 16,000 employees in over 35 countries servicing a million clients. Its clients are categorised as “retail” – for example individuals saving for retirement – and “institutional”, such as insurance companies and pension funds. Through the assets it manages, BlackRock holds shares and debt in thousands of companies.

BlackRock was founded in 1988 by eight financial services professionals, including chair and chief executive officer (CEO) Laurence ”Larry” Fink. It became a publicly-traded company when it listed on the New York Stock Exchange in 1999. The company grew via a series of competitor acquisitions, and cemented its position as the world’s largest asset manager with the purchase of Barclay’s Global Investors (BGI) in the aftermath of the 2008 financial crisis. Major shareholders include many of BlackRock’s competitors; the most significant stake is held by Vanguard Group at approximately 9% – its closest (apparent) rival in the asset management space.

The scale of investments controlled by BlackRock affords it massive influence within the financial system and the US state. In 2008, it worked with the US government on the latter’s response to the financial crisis, advising it and helping manage the distressed and toxic assets it acquired in market interventions. It also had extensive involvement in the state response to the market impact of the COVID-19 pandemic in 2020. The company has made a number of high-profile hires from Barack Obama’s presidential administration. These include Brian Deese, who had helped negotiate the Paris Climate Accords, and was brought on to lead on sustainable investing. Several of these appointees subsequently returned to Washington to work for Joe Biden.

The company’s political lobbying and donations reached a record $3.5m (£2.8m) in 2022.

Environmental, Social and Governance (ESG): Claims vs Reality

On the face of it, BlackRock has made prominent commitments on climate change in recent years, promoting “sustainable investing” and a transition to “net zero” by 2050. The concept of “net zero” or “carbon neutral”, means the amount of carbon pumped into the atmosphere is balanced out by what is removed. BlackRock has signed up to industry initiatives including Net Zero Asset Managers (NZAM) and Climate 100+; investor pressure groups aiming to convince major polluters to reduce carbon emissions.

Recent data released by environmental NGO Urgewald indicates that BlackRock has at least $263bn (£208bn) invested in fossil fuels via its funds; indeed, BlackRock and Vanguard together reportedly represent 17% of institutional investments in the fossil fuels industry.

Like Vanguard, BlackRock voted against 80% of climate-related motions at the annual general meetings (AGMs) of FTSE 100 and S&P 500 firms between 2015 and 2019. Meanwhile, BlackRock’s ESG-labelled funds were found to be the worst for deforestation risk in a 2020 analysis.

A series of investigations published by Reclaim Finance have also contrasted BlackRock’s investments with their ESG messaging. They pointed to $85bn (£67bn) in managed assets invested in coal companies in 2020, including $24bn (£19bn) in firms with expansion plans, despite a policy to “exit thermal coal”. Votes against climate resolutions in shareholder meetings had in fact increased to 88% that same year. A 2021 report exposed the $75bn (£59bn) BlackRock had invested in companies engaged in environmentally ruinous tar sands projects, while Reclaim Finance’s 2022 report, “The asset managers fuelling climate chaos”, examined BlackRock’s role in the corporate debt of major carbon emitters. BlackRock was found to be one of the biggest bondholders of coal companies with expansion plans, and one of the top bondholders in an analysis of more than 300 oil and gas companies. It was also ranked amongst the “worst in class” in a recent Share Action analysis of asset managers’ actions to address climate breakdown.

Despite its ESG commitments, BlackRock simultaneously promotes its extensive investments in carbon emitters. In correspondence with US state officials, it has described itself as “perhaps the world’s largest investor in fossil fuel companies”. When faced with an anti-ESG backlash, it emphasised the $170bn (£135bn) it had invested in US energy companies, denying accusations of any boycott or divestment strategy. In the UK, it told the parliamentary environmental audit committee last October that it would not end investments in coal, oil or gas, citing its fiduciary duty to clients over a decarbonisation agenda. Contemporary data from financial databases on shareholdings in major US, European, Chinese and Middle Eastern energy and fossil fuel companies shows that BlackRock controls the largest private share. As BlackRock itself says, its focus on climate is as capitalists, not environmentalists.

UK location: 12 Throgmorton, City of London.

BlackRock CEO: Laurence “Larry” Fink

Laurence “Larry” Fink is the face of BlackRock. He has been chief executive officer (CEO) since he co-founded the company in 1988, and now also serves as chair of the board of directors and the global executive committee. He has been called the “undisputed king of Wall Street” by the Financial Times, and is considered to be worth approximately $1bn (£792m). He was paid $36m (£29m) by BlackRock for 2021, up from nearly $30m (£24m) the year before. He holds $312m (£247m) in company stock at current market rates.

Prior to BlackRock, Fink became the youngest managing director at investment bank First Boston, before a $100m trading loss on an interest rate bet in 1986 ended his career there. He was a pioneer of mortgage-backed securities (MBS), the financial product which would go on to be the trigger of the 2008 financial crisis. In 2021, he expressed an ambition to do for sustainability what he had done for mortgage-backed securities.

Fink has been at the forefront of BlackRock’s attempt to frame itself as an environmentally responsible investor. The topic has featured consistently in his most high-profile communications to clients and to the CEOs of major companies. However, he has faced calls to stand down by one investor, Bluebell Capital Partners, over the hypocrisy of the company’s continued fossil fuel investments, and has been named among the “dirty dozen” of climate crisis villains.

Fink and his wife Lori own a number of rural estates in a wealthy enclave of North Salem, New York state, dubbed “Billonaires’ Dirt Road”.

#2: The Vanguard Group

Vanguard’s ethos? In the words of CEO Tim Buckley: “Climate change is a material risk but it is only one factor in an investment decision.”

Vanguard Group, Inc. is an investor-owned, US global asset manager, currently managing approximately $7.7tn (£6.6tn). Second only to BlackRock, Vanguard has over 30 million investors across 400 funds worldwide. The company’s founder Jack Bogle was the originator of the passive index fund in the mid-1970s, and it remains largely an index investor, allocating funds to every major company on the world’s exchanges – including, of course, many of the biggest polluters.

Environmental, Social and Governance (ESG): Claims vs Reality

In 2015, the same year the Paris accords were signed, Vanguard overtook competitors to become the second biggest investor in both BP and Shell. Speed forward to 2023 and Vanguard’s stake in these two big polluters has doubled.

Vanguard’s growing investments in the two oil multinationals have paid off nicely: from 2016 to 2022, Shell paid nearly £3.4bn to Vanguard, compared £686m in the previous seven years.

The company currently holds the ignominious title as the largest institutional investor in fossil fuels, slightly ahead of BlackRock,with at least $269bn (£213bn) invested in the industry. Since the 1980s, it has offered specific funds for investors intent on funding the sector. These include the Vanguard Energy ETF, which is 100% comprised of firms involved in the production of fossil fuels, including coal; and Vanguard Energy Fund Investor Shares. Apart from Shell and BP, these funds are also pouring money into companies such as ConocoPhillips, Total, Exxon Mobil and Chevron.

But Vanguard’s investment in climate wreckage is not ring-fenced to these special energy funds. According to the Financial Times, in 2022 only 17% of even Vanguard’s actively-managed funds were in keeping with with aim of net-zero by 2050. Up until the Russian invasion of Ukraine in 2022, Vanguard had no qualms about investing in one of the world’s biggest gas producers, Russia’s state-owned Gazprom. Meanwhile, Vanguard had €1bn (£792.5m) invested in German coal giant RWE when the latter the evicted and destroyed Lützerath village for the expansion of the Garzweiler mine this January, despite the resistance mounted by 35,000 protestors, including Greta Thunberg.

Alongside BlackRock, Vanguard is one of the world’s top investors in the coal industry – with over $100bn (£79.3bn) invested in the sector.

As paltry as ESG funds may be, Vanguard offers just seven of them – representing a mere 0.38% of its assets – and trailing behind BlackRock in this respect. These funds invest in companies like Barclays (the UK and Europe’s top fossil fuel financier), JP Morgan, and Bank of America (both in the top four fossil fuel financiers over the last six years).

Vanguard eventually joined – and recently pulled out of – the Net Zero Asset Managers initiative, because its “voice was being drowned out”. Although there was talk of other big investors defecting, so far only Vanguard and Green Century Capital Management have quit, leaving behind well over 500 other competitors. The company’s approach to corporate responsibility is summed up by CEO Tim Buckley:

“We don’t believe that we should dictate company strategy…It would be hubris to presume that we know the right strategy for the thousands of companies that Vanguard invests with…. [Vanguard is] not in the game of politics”.

According to Majority Action, the company scored lowest of all asset managers in shareholder resolutions to disclose lobbying activities – with zero motions supported. This means Vanguard is actively preventing transparency about corporate lobbying activities of companies such as BP and Shell.

UK location: 25 Wallbrook, City of London.

Vanguard CEO: Mortimer J “Tim” Buckley

In 1991, Mortimer J “Tim” Buckley, fresh out of a BA in Economics at Harvard, joined Vanguard as assistant to the company’s founder, Jack Bogle. Buckley steadily rose up the ranks, serving as Chief Investment Officer before becoming the CEO in 2018 and then Chairman in 2019.

On an autumn day last October, Buckley’s Pennsylvanian mansion doorstep was the site of a Quaker-led action. Fifty protestors with red t-shirts emblazoned with “Vanguard Invests in Climate Destruction” delivered a letter to Buckley, unfolded deck chairs, and sat in silence for 30 minutes in front of the house.

Since 2021, Buckley has lent his expertise as an Industry Governor for the US Financial Industry Regulatory Authority (FINRA). The authority supervises the integrity of financial markets and investors such as Vanguard.

Buckley’s annual pay cheque is unknown (salaries for Vanguard top brass are a closely-guarded secret), but the company reportedly provides “very high compensation levels” for managers. His predecessor’s salary, at the end of his term, was estimated to be $10-15m (£8 -12m) annually.

#3: Norges Bank Investment Management (NBIM)

Norges Bank Investment Management (NBIM) is the day-to-day fund manager of the Norwegian Government Pension Fund Global (GPFG) – one of the world’s largest sovereign wealth funds (SWFs) The fund was established in the 1990s to protect the revenue made from oil in the North Sea. Norway is now the largest oil-producing state in Western Europe.

In 1998, NBIM was formed to manage and grow the fund, and hedge risks from fluctuating oil prices by investing entirely in international markets. NBIM describes it as “the Norwegian people’s piggybank”. The fund generates income from oil and gas production, although the majority has been acquired through investments in the stock market, government and corporate bonds, and real estate.

NBIM is part of Norway’s central bank, Norges Bank, and the fund is ultimately managed on behalf of the Ministry of Finance. It is therefore an intermediary body owned by the Norwegian government.

Much like the index investors in this list, NBIM’s holdings are truly global, with an average 1.5% share in all the world’s listed companies. Details of current and past countries where the fund is invested can be found (and filtered) here. Its largest holdings by late 2021 were by far in the US (43.3%), followed by Japan (8.4%), and the UK (6.9%).

Although the fund made a negative return on its investments last year of -14%, its market value was still a massive Kr12tn (£917bn), largely due to the soaring price of oil and gas.

Environmental, Social and Governance (ESG): Claims vs Reality

NBIM’s portrayal of itself versus its actual role in climate destruction is perhaps best painted through the example of its CEO, Nicolai Tangen, riding an e-scooter to work on his first day managing one of the world’s largest oil funds. The extreme dragging on ESG policies by Republicans in the US, exploited by NBIM’s greenwashing PR exercises, have portrayed the wealth manager and its CEO as climate-saving warriors. Its publications are riddled with all the common markers of greenwash, but a quick glance at NBIM’s accounts and actions exposes little substance behind proposals, commitments, and “engagements”.

NBIM has made huge profits from oil and gas companies, including BP and Shell. As one of the top shareholders of both, between 2016 and 2022 it received nearly £1bn in payouts from BP, and around £2.3bn from Shell. By early 2023, NBIM’s holdings in BP and Shell were valued at £2.7bn and nearly £5.4bn, respectively.

A quick glance at NBIM’s voting history for companies like BP, Shell, Exxon Mobil, and TotalEnergies, inevitably exposes a very different picture to that described in the company’s ESG literature. Despite sensational threats to vote against directors who don’t prioritise climate targets, NBIM has repeatedly voted to re-elect directors of oil companies such as BP and Shell. It will come as no surprise to readers to learn that this oil fund manager has also voted against numerous resolutions by activist shareholders to curb emissions.

Despite its losses on investments, NBIM enjoyed a record injection of cash to the fund in 2022 from the Norwegian state’s oil and gas revenues, thanks to the rise in oil prices globally. This serves as a crucial reminder that for all its tough talk on climate change, the company remains fundamentally reliant on revenues from hydrocarbons.

Norway’s fossil fuel industry continues to expand, and with the country planning to offer energy firms a record 95 oil and gas exploration blocks in the Arctic, we can expect to see the continued growth of the oil fund too.

UK location: 3 Old Burlington Street, Mayfair

NBIM CEO: Nicolai Tangen

NBIM’s CEO, Nicolai Tangen, was recently referred to as the “trillion dollar-man”, and “the most influential person in the world you have probably never heard of”. He made his fortunes as a hedge fund manager, having run his own fund, AKO Capital, for nearly fifteen years. With a net worth of £550m, his wealth had been large enough for him to make The Sunday Times’ “Rich List 2020”. Tangen was a former intelligence officer in the Norwegian military, and currently owns the world’s largest Nordic modernist art collection.

When Tangen was appointed to CEO in 2020, his extravagant lifestyle and background as a hedge fund manager raised suspicions about his fitness for the job looking after the state’s wealth. Eyebrows were raised still higher given that his name hadn’t been put forward in a shortlist of candidates for the role.

The appointment followed a lavish, all-expenses-paid-for event that he had organised for an array of high-powered corporate and government guests – including the outgoing CEO, Yngve Slyngstad. Tangen reportedly “spent millions of pounds flying 120 movers and shakers from across the world”. Guests included the former Conservative leader, William Hague; chef Jamie Oliver; and British Museum director Hartwig Fischer. The exclusive list of invitees attended a diverse range of seminars before being entertained by a one-hour, one-million-dollar live performance by Sting. Think Ed Norton’s tech billionaire’s get-together in The Glass Onion and you get the picture.

Tangen also came under scrutiny for his large personal investments in tax havens and in particular, a case between HMRC and AKO Capital regarding deferred tax payments.

#4: Legal and General Investment Management (LGIM)

LGIM is another global asset manager, and Shell’s fourth-largest shareholder. It’s a subsidiary of Legal & General Group PLC, a British multinational financial services firm and one of the country’s largest insurance businesses. Founded in 1836, the Group is a major pension fund manager in itself. But it is perhaps better known for enabling other pension funds to hedge their risks – associated, for example, with market volatility, or people living longer than expected – and acting as a buffer between the market and its pension fund clients.

As part of this, LGIM has become the UK’s largest asset manager, controlling over £1.2tn in investments. The corporate group is made up of hundreds of companies. Headquartered in London, it has  approximately 10,000 employees worldwide. It was headed by outgoing CEO, Sir Nigel Wilson since 2012. A Brexiteer, Wilson was part of David Cameron’s business advisory board in the lead-up to the 2016 referendum. He has recently been replaced by António Simões, a former Santander boss.

Legal and General’s top shareholders include BlackRock, Vanguard and Capital Group.

Environmental, Social and Governance (ESG): Claims vs Reality

The Group’s current mantra is “Inclusive Capitalism”: of all the asset managers listed in this series, LGIM and its parent company try the hardest to paint themselves as responsible investors. LGIM is a signatory to the Net Zero Asset Managers pledge for a “net zero asset” portfolio by 2050, and has been rated favourably by Majority Action for its climate action in the form of targeted voting and investment sanctions.

In contrast to most of Shell and BP’s other top investors, its stake in both companies has diminished steadily, while its recent voting record on climate targets more generally makes its actions more consistent with its ESG claims than many others. It has even partnered with US NGO Environmental Defense Fund to encourage businesses to “go green”, and its ESG targets became a criterion for awarding bonus shares under the Group’s management performance share plan in 2021. Executives and directors such as Nigel Wilson – who was awarded £2.6m in shares last year under the plan – now therefore stand to directly benefit from hitting ESG targets.

LGIM has reduced its shares in BP by 62% and in Shell by 43% since the Paris Agreement. Nevertheless, of the top investors in this list, only BlackRock has benefited more than LGIM from its investments in the two oil majors: LGIM has received over £2bn in returns on those investments since 2016; and in 2022, LGIM received £405m from these holdings. This is considerably more than in 2016, despite owning fewer shares.

Legal & General as a whole has at least $18bn (£14bn) invested in fossil fuels. Back in 2019, LGIM defended its choice to include Shell in the top ten holdings of its “climate-conscious” Future World fund in the face of criticism from one of its pension fund clients. Two years later, LGIM was apparently on the side of activists, voting at Shell’s AGM to reduce emissions. And yet, today, investing in LGIM’s fund “RAFI Fundamental Global Low Carbon Transition Equity Index”, means investing in companies such as Shell and Exxon Mobil – as well as top fossil fuel banker, JPMorgan Chase.

In spite of being held up by some as an almost exemplary shareholder, besides oil and gas, the company still invests heavily in coal. Latest figures indicate that the company has $6.1bn (£5.3bn) resting in firms associated with coal mining or production, such as Duke Energy and Glencore.

UK location: 1 Coleman Street, City of London

LGIM CEO: Michelle Scrimgeour

In the words of LGIM CEO Michelle Scrimgeour, LGIM’s climate commitments are “not principles before profit”, but “simply good business sense”. Michelle Scrimgeour joined LGIM as CEO in 2019. Her career in the sector began in the late eighties, when she held several senior positions at asset management firms, including BlackRock, one of Legal and General’s top shareholders.

Today, Scrimgeour also sits on the board of directors of the UK’s trade body for investment, the Investment Association. In 2021, she had the chance to put LGIM’s interests at the heart of climate crisis negotiations as the co-chair of the UK Government’s COP 26 Business Leaders Group, alongside COP 26 president Alok Sharma. Laughably, Scrimgeour used her platform to insist on the need for clear rules to guard against greenwashing. Scrimgeour is also a member of the Women in Finance Climate Action Group. Presented as an industry role model, Scrimgeour makes it on the Financial News’ top 100 influential women in finance year on year. Before Scrimgeour stepped down from the group’s executive board in 2020, the company disclosed that she had received a salary of £2.4m.

#5: UBS Asset Management

UBS Asset Management AG is a subsidiary of the Swiss-based bank and financial services firm, UBS Group AG. UBS Asset Management handles investments for corporate and private clients, primarily through actively-managed funds. It also has a relatively small portion ($443m; £351m) invested in passive funds, a figure which is expected to grow significantly since UBS’ recent takeover of Credit Suisse – a company with large investments in passive funds.

The parent company is Switzerland’s biggest bank, and now the world’s fourth largest by asset. Since the Credit Suisse merger, the bank’s assets are in fact now twice the value of Switzerland’s GDP, sparking fears over its power and the Swiss economy’s exposure to a single company. UBS Group has been described as the world’s largest private bank – meaning that through its “wealth management” division, the company services rich individuals with advice on topics such as taxation, wills and trusts, and by managing their investments.

The company’s roots are apparently several centuries old, though its current incarnation is the product of the 1998 merger of the Union Bank of Switzerland and Swiss Bank Corporation. UBS AM has $1.1tn (£872bn) in assets under management; this is expected to grow significantly since the Credit Suisse takeover. The Group as a whole now has $5tn (nearly £4tn) in invested assets ($2.8tn prior to the takeover). Its fortunes were already growing before the merger: in a year with rising commodity prices and inflation triggered notably by the war in Ukraine, last year the Group made a net profit of $7.6bn (£6bn) – an annual increase of around £137m. With the dust of the Credit Suisse affair still settling, we have yet to see quite how much the acquisition will benefit the company.

The top shareholders of UBS Group are Dodge & Cox and Artisan Partners LP – both privately-owned US active fund managers – as well as BlackRock, Vanguard and Norges Bank Investment Management.

Environmental, Social and Governance (ESG): Claims vs Reality

The company calls itself “a leader in sustainability”, with UBS AM having been one of the founding signatories of the Net Zero Asset Managers initiative. UBS AM plans to become “net zero” across the whole business – including so-called “Scope 3 emissions” – by 2050. Scope 3 emissions, by UBS’ own definition, refer to:

“…emissions resulting from activities from assets not owned or controlled by the reporting organization, but that the organization indirectly impacts in its value chain”.

These can be interpreted as covering, for example, a bank’s investments. However, UBS’ application of this criteria is ambiguous. While its definition of Scope 3 emissions appears to include financing fossil fuel exploration and production, it does not seem to include their transportation and trade. 2021 has been called the “year of ‘net zero by 2050’ pledges”, with many banks and asset managers making bold public commitments to the goal. The 2050 target was agreed by the IPCC. However, it is now clear that the date is far too late; by that point climate change will be truly irreversible. And research shows that the top fossil fuel companies are – unsurprisingly – nowhere near on target. Net zero, along with “impact investing”, is therefore just another distraction with a catchy name, allowing  companies to “burn now, pay later”.

Like other asset managers, UBS AM offers a number of “socially responsible” or “low carbon” funds for investors. But the Group has reported that its so-called “sustainable investments” – for example in energy-efficient properties – currently in fact represent just 6.8% of its overall portfolio. And by its own admission, 7.5% of the Group’s customer lending is still linked to carbon-related assets; in January 2023, it had at least $20.8bn (£16.5bn) invested in fossil fuels in the form of shares and bonds. Among the risks identified by the group in its latest annual report are “concerns about greenwashing, where UBS may be subject to reputational risk if not fully aligned with sustainability-related criteria”. It specifically cited the “new standards and rules” being developed in some countries, and the “increased risk that UBS may not comply with all relevant regulations”. In other words, the company is clearly worried about the impact on its reputation if it fails to put in place adequate sustainability measures.

UBS AM has made over £1bn in dividends and buybacks from its investments in BP and Shell since the Paris Agreement. This will have benefited top management and directors, as well as its own shareholders. Despite its bold declarations, UBS Group also has approximately $5.6bn (£4.45bn) invested in the thermal coal industry through both shares and bonds. UBS AM notably has no coal exclusion policy for its passive funds. Its holdings are unlikely to decline following the acquisition of Credit Suisse, a company which financed the fossil fuel industry to the tune of nearly $91.8bn (£73bn) from 2016-2020.

UK location: 5 Broadgate, City of London.

UBS CEO: Sergio Ermotti

Until April 2023, UBS Group was being steered by “Europe’s best-paid bank boss”, Dutch banker Ralph Hamers. However, he was bumped out of position after less than three years following the surprise return of Sergio Ermotti, who was brought back to oversee UBS’ takeover of Credit Suisse.

Ermotti previously served almost a decade at the helm of UBS until 2020, and is credited with turning the company’s fortunes around during the 2008 financial crisis. He apparently drafted plans to acquire Credit Suisse “three or four times” during his previous tenure, making him an obvious choice to oversee the merger.

Ermotti’s banking career began aged 15. He worked at Citibank, UniCredit Group and Merrill Lynch, before several years leading insurance firm Swiss Re.

You have to wonder whether the change in leadership might have had anything to do with the revival of a criminal investigation into former CEO Ralph Hamers for suspected money-laundering from his stint at his previous bank, ING. The case against Hamers had been already been investigated twice, with ING settling out of court in 2018 for €775m (£673m). The 50% pay rise Hamers received at ING at the time reportedly led to hundreds of ING customers shutting their accounts in protest. In spite of the ongoing investigation, Hamers received a salary of $13m (over £10m) as boss of UBS in 2022 – an annual increase of 11%.

#6: State Street Global Advisors

State Street Global Advisors (SSGA) is one of the world’s largest asset managers and the smallest of the “Big Three” index fund managers. It is the asset management division of its parent company, the finance giant, State Street Corporation. SSGA’s clients include pension schemes, corporations, investment consultants, endowments and foundations, governments, and other asset managers.

SSGA currently manages approximately $3.8tn (£3.3tn) in assets. The company has over 2000 clients in 58 countries; its largest geographical market is the US, where it is headquartered.

State Street Corporation’s largest shareholders mostly consist of investment management firms. Collectively, these top ten shareholders hold around 40% of the shares. Vanguard holds the largest, at nearly 13%; it is followed by BlackRock, Dodge & Cox, T Rowe Price Associates and Capital International Investors (owned by Capital Group).

Environmental, Social and Governance (ESG): Claims vs Reality

The last decade has seen SSGA write its history as one concerned with matters of Environmental, Social and Governance (ESG) issues. It has advertised the launch of an ESG Money Market Fund, as well as an ESG scoring tool called R-Factor. A closer look at SSGA’s policies and ties to the oil and gas industries, however, thoroughly undermines these gestures.

State Street as a whole has at least $133bn (£106bn) invested in fossil fuels. SSGA has no exclusion policy for oil and gas – including for its “passive” assets, which are worth over $3tn (£2.4tn) – and fails to exclude coal from its investments. Since 2016, SSGA has received cash earnings of over £1.1bn from BP, and over £1bn from Shell. And SSGA’s total shares and bonds in 12 major oil and gas companies with the biggest short-term expansion plans – including both BP and Shell – exceed $83bn (over £66bn).

The company’s voting record reveals that despite its feeble attempts at greenwash, SSGA has been significantly obstructing action on climate change. Data from the first six months of 2021 and 2022 shows an actual decrease in SSGA’s support for climate-related proposals – apparently on the grounds of their “prescriptive nature”. And by its own admission, in the first six months of 2022 SSGA voted against all transition to renewable energy proposals, and against “operational changes in response to climate change” in 86% of cases. SSGA explained its opposition to action on climate change with the following:

“we have not been supportive of proposals that request a specific operational change such as phasing out a product or business line within a defined timeframe, decommissioning assets, or requesting a transition to renewable energy…”.

All motions made by oil and gas company shareholders to scale back greenhouse gas emissions in line with targets agreed in the Paris Agreement were either voted against or abstained on by SSGA. It has also voted against so-called dissident CEO candidates, such as those with expertise in renewable energy.

SSGA has rejected calls for divestment, describing it as an inadequate “option for investors” that “is seldom an effective tool”. As shown by Reclaim Finance, pitting exclusion and engagement against each other can serve to paint these strategies as mutually exclusive. More problematic is the front that this framing of “engagement” can serve for investing in companies that continue to expand and profit from oil and gas production, as is the case for SSGA.

UK location: 20 Churchill Place, Canary Wharf.

SSGA CEO: Yie-Hsin Hung

Yie-Hsin Hung has been the President & CEO of SSGA since December 2022. She was previously CEO of New York Life Investment Management (NYLIM), and worked at Bridgewater Associates and Morgan Stanley. Hung has been listed in American Banker’s “25 Most Powerful Women in Finance” for five years, and has recently been re-elected as Chair of the Executive Committee of the Investment Company Institute (ICI). The ICI is an investment association which has members that manage $37.8tn in assets (almost £30tn).

Ronald O’Hanley is Chairman and CEO of SSGA’s parent company, State Street Corporation, and previously occupied Hung’s position at SSGA. Last year, Hanley received a salary of $18m (£14m) – a 93% increase from 2020 to 2022. Putting this into perspective, the pay ratio between his annual compensation and the median compensation of all State Street Corporation’s employees for 2021 was estimated to be a staggering 230 to 1.

#7:SAFE Investment Company

SAFE Investment Company Ltd. is one of China’s sovereign wealth funds (SWFs). It is the Hong Kong subsidiary of China’s foreign exchange regulator, the catchily-named State Administration of Foreign Exchange. Its ultimate parent is the country’s central bank, the People’s Bank of China.

Established in 1997, last year SAFE controlled nearly $1tn in assets, coming in just behind the China Investment Corporation (CIC), one of the world’s largest SWFs. China’s multiple SWFs were set up in the late nineties and early noughties as the government sought to increase engagement with international markets. Seeing an opportunity, SAFE began buying into major global firms during the 2007-8 financial crisis. Among the companies it began investing in at this time was BP; by 2008 it had upped its share in the company to a potential $2bn (£1.6bn).

Its shares in Shell and BP represent the company’s most valuable holdings, currently amounting to around £1.8bn and £1.2bn respectively. Besides these British oil giants, UK companies feature prominently among SAFE’s top public investments. These include pharmaceutical companies, AstraZeneca and GSK, and mining behemoths Anglo American and Rio Tinto. It invests in Yara, among the world’s largest producer of fertiliser (see Corporate Watch’s profile on Yara and its role in climate chaos here). These holdings are followed by a host of major Western brands, from Tesco and Lloyds Bank, to Burberry, Next, Whitbread and Compass Group.

It owns 0.47% of the UK’s National Grid – a holding currently worth £198m – and even has a stake in the London Stock Exchange.

SAFE’s largest shareholdings betray a particular interest in North Sea oil and gas, China being the world’s biggest importer of oil. It holds millions worth of shares in Subsea 7, an engineering firm servicing the offshore petrochemicals industry, notably North Sea oil. Subsea 7 is in turn is being awarded contracts by Norway’s state oil firm Equinor – which SAFE also has a stake in.

Despite having such a broad array of investments in global companies, like other sovereign wealth funds there is remarkably little publicly available information on SAFE. It does not publish information, at least in English, on any environmental standards.

UK location: Unclear if any.

Governor of the  People’s Bank of China: Yi Gang

The management structure of SAFE Investment Co Ltd is not transparent. However, we know that the State Administration of Foreign Exchange is led by Pan Gongsheng, currently also Deputy Governor of its parent, the People’s Bank of China (PBoC). He answers to former SAFE administrator, and current head of the PBoC, Yi Gang.

Yi Gang gained a Ph.D in Economics from the University of Illinois and later taught at Indiana University, Indianapolis, which he has referred to as his “second home”. Following his leadership at SAFE, he worked at the PBoC until he was appointed to the role of PBoC governor – the top management position – in 2018. He has just been re-appointed to the post for a second five-year term despite expectations to the contrary. Following an economic slowdown in China owing to strict COVID-19 lockdown measures, a weakening real estate market, and inflation hitting demand for Chinese goods abroad, this decision has been read as a bid by the Chinese state to maintain the appearance of stability.

But even a man described as “the most prominent Chinese figure in global finance”, is to some extent just a figurehead. He reportedly has no role in developing state monetary policy, as is the case in many other countries. Instead he implements the decisions of a “policymaking body whose membership is a secret”.

And as we can expect, any details on his interests, personal life, family connections and property remain well-hidden from public view.

#8: abrdn

abrdn plc, pronounced “Aberdeen”, is a multinational asset manager headquartered in Edinburgh. It provides investment services and financial advice to both institutions and individuals. Holding nearly £500bn of investments on behalf of its clients, it has been described as a “generalist” financial services firm, not specialising in any one form of investment.

It is one of the UK’s largest asset managers, and focuses on actively-managed investments, although it manages some passive funds as well. It employs over 5,000 people. abrdn is the rebranded name of Standard Life Aberdeen, which was created by the merger between Standard Life and Aberdeen Asset Management in 2017. The latest name change (“disemvoweling”, as it’s called) took effect in 2021 following the sale of assets and the Standard Life brand to UK-based pension fund Phoenix Group. abrdn and Phoenix have a complex strategic partnership, which includes abrdn managing around £147bn of Phoenix’s pension fund assets, making Phoenix abrdn’s largest client. abrdn and Phoenix Group have been fined over £7m and £35m respectively for investor protection and pension plan violations in the UK since 2010.

Since the merger, the company has been struggling with an identity crisis, declining share price, significant job cuts, and low staff morale which has been compounded by disquiet over the CEO’s “draconian” management style.

Environmental, Social and Governance (ESG): Claims vs Reality

abrdn’s environmental, social and governance messaging, which features prominently in company communications, has to win the prize for the most hypocritical and absurd. This is exemplified in its sustainability-themed partnership with the Financial Times, which includes content unironically offering to help spot corporate greenwashing, cautioning:

“As more consumers and investors embrace sustainability, companies are often tempted to exaggerate their social and environmental credentials.” In the same piece, abrdn suggests investors concerned about the environment could avoid selling shares in oil and gas companies, and even buy more of them.”

abrdn currently invests at least $5.7bn (£4.5bn) in oil, gas and thermal coal companies in the form of shares and bonds. Just over half of that total is invested in Shell and BP. abrdn previously rejected the call by “activist” hedge fund Third Point to break up Shell, in an apparent effort to accelerate the transition away from fossil fuels. According abrdn’s latest filings, it also manages holdings of around £3.4bn in destructive mining companies, most notably, notorious conglomerates Glencore, Rio Tinto and Anglo American.

abrdn appears to have made urgent climate commitments as a signatory of the Net Zero Asset Managers Initiative (NZAM). However, the latest annual report reveals that only 30% of assets under management are within the scope of its carbon reduction targets. Reclaim Finance’s “Asset Managers Fuelling Climate Chaos” report offers a damning indictment of abrdn’s climate targets. It found no exclusion policies for investing in coal, oil or gas developers and allotted abrdn one of the worst ratings of the 30 firms under consideration with a score of just 1.3 out of a possible 30. abrdn in fact has significant investments in companies with plans to expand their fossil fuel operations. As of 2022, it held $900m (£713m) in bonds and $4.3bn (£3.4bn) in shares in these major carbon emitters.

In particular, the company is among the biggest bond holders in scandal-hit coal producer Adani. Adani reported to have invested £2.5bn in new coal mines in the last decade, whilst its coal output increased by 58% between 2021-2022. Its appalling track record has been extensively catalogued by campaigners against Adani in efforts to oppose coal mining activities in Australia. Corporate Watch has also reported on the threat to the environment and communities posed by its expansion in Australia’s Galilee Basin with Adani’s Carmichael coal mine. Whilst abrdn has declined to comment about its Adani bonds, it touts its membership of the “Powering Past Coal Alliance” and recognises coal to be the most carbon intensive fossil fuel. Perversely, abrdn selectively cites the potential impact on communities “reliant” on coal as a counter-consideration to the need to phase out its use, declaring its support for a “just transition”.

UK location : 1 George St,  Edinburgh.

abrdn CEO: Stephen Bird

A Scot who started his career working in the steel industry, abrdn CEO Stephen Bird went on to enjoy a 20-year stint at Citigroup, most notably his role as CEO of consumer banking between 2015 and 2019. Citigroup have paid out huge fines, £282m and $26.6bn (£223m and £21bn) respectively, for regulatory violations in the UK since 2010 and the US since 2000. This includes nine-figure sums paid during the years that Bird was responsible for global consumer and commercial banking.

Bird joined abrdn’s board in July 2020 before becoming chief executive officer in September of that year, presiding over the much-ridiculed rebranding. More recently he has been the subject of an extensive exposé, based on the testimony of insiders, regarding allegations of aggressive and intimidating behaviour in his leadership of the company. These include him reportedly shouting “Are you a group of delinquent primary school children? This is a f***ing disgrace” at his colleagues during a discussion on voluntary redundancies.

His relationship with some of his co-workers has not been helped by his decision to award himself a £1.8m bonus, while cutting radically back on other staff bonuses. Since joining abrdn, Bird has been paid a total of £5.5m in compensation as chief executive officer and executive director. This is despite a continued decline in funds under management between 2020 and 2022 and the company briefly exiting the FTSE 100.

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Carbon Cash Machine: charting the payouts to BP and Shell shareholders https://corporatewatch.org/carbon-cash-machine-charting-the-profits/ Thu, 10 Aug 2023 00:01:22 +0000 https://corporatewatch.org/?p=12653 In collaboration with Queen Mary University’s Centre for Climate Crime and Justice, Corporate Watch is publishing our investigation into the monumental growth in cash payouts made to investors in the UK’s largest oil firms, BP and Shell, since the signing of the Paris Agreement on climate change at the end of 2015. ‘The Carbon Cash […]

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In collaboration with Queen Mary University’s Centre for Climate Crime and Justice, Corporate Watch is publishing our investigation into the monumental growth in cash payouts made to investors in the UK’s largest oil firms, BP and Shell, since the signing of the Paris Agreement on climate change at the end of 2015.

‘The Carbon Cash Machine’ examines the cash earnings to shareholders over seven years, profiles the beneficiaries, and considers the implications for divestment campaigns.

We found:

  • Annual cash earnings made by shareholders in the UK’s two largest oil companies (BP and Shell) are around triple the amount they were when the Paris Agreement was signed in December 2015. Their total earnings since the Agreement amount to £131bn.
  • £131bn could fund solar panel installation for approximately 13 million houses. Less than a fifth of the figure could cover the costs of the 40 new hospitals the government has pledged. One tenth could meet the shortfall in UK social care provision.
  • The eight largest shareholders in both BP and Shell have made a total of £28.7bn since the Paris Agreement. Those shareholders are: abrdn PLC; BlackRock Inc.; Norges Bank Investment Management; Legal & General Investment Management Ltd.; SAFE Investment Co. Ltd.; State Street Global Advisors Inc; UBS Asset Management AG; and Vanguard Group Inc.
  • The top three shareholders of both increased the proportion of their collective holding of BP from 11.48% in 2016 to 17.71% in 2022. The same major shareholders increased the proportion of their collective holding of Shell from 13.08% in 2016 to 15.89% in 2022.

Introduction: “spewing out cash”

In the second half of 2022, as energy prices continued to soar and the cost-of- living crisis deepened, the business media began reporting new highs in oil company dividend payments with remarkable hyperbole. In August, Bloomberg headlined with “Big Oil is Paying Out Years of Dividends in One Day.” In November, Barron’s noted “Oil Companies Lift Their Dividends as Cash Rolls In”. A few months later, Reuters reported “Bumper profits fuel surge in dividends, buybacks at oil firms”. The bonanza continued as a number of oil firms reported record profits for the last quarter of 2022. And in February 2023, Forbes led with the headline “We’ve Struck Oil: 3 Energy Plays Yielding Up To 11% in Dividends.”

All of the hyperbole is justified. Oil company dividends are rising very rapidly indeed. This is largely because – to quote one trader – the energy industry has become “a broken ATM spewing out cash.”

According to even the conventional logic of the markets, it isn’t supposed to be like this. That logic claims that oil company dividends should be influenced by several factors, including the shifting energy balance towards renewables, increasing regulatory pressure to reduce emissions, and the rise of divestment campaigns. As the climate crisis accelerates, shifts towards a low-carbon economy should have led to a decline in demand for fossil fuels, and investors were supposed to become increasingly concerned about the long-term sustainability of oil companies. Yet oil companies are making record cash payouts to their shareholders.

This report reaches behind the corporate veil to identify the major beneficiaries of the UK’s largest fossil fuel companies, BP and Shell. It analyses their cash earnings from those shares since the Paris Agreement on climate change, and juxtaposes their corporate spin on environmental targets with facts and figures on their fossil fuel investments.

Our aim is to provide a rich analysis of the large institutional shareholders who have retained their investments in oil and gas – in a period that most observers of the Paris Agreement might reasonably have expected to be a time of divestment in fossil fuels.

A second report will go on to ask profound questions for the fossil fuel divestment movement and how it might develop more effective forms of campaigning to ultimately stop the flow of capital into the industry.

Read the full report here.

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Research Against Racism: investigating companies that sustain structural inequalities https://corporatewatch.org/research-against-racism-investigating-companies-that-sustain-structural-inequalities/ Tue, 25 Jul 2023 13:29:59 +0000 https://corporatewatch.org/?p=12608 A fully-funded training opportunity Dates: 30th September – 1st October 2023, 10-5pm, in person. 9 October – 19 November online. Location: Bristol (two days in person); remote (over six weeks). Corporate Watch is running a six-week, hands-on training programme on how to investigate and report on companies sustaining structural racism. This is a fully-funded programme, […]

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A fully-funded training opportunity

Dates: 30th September – 1st October 2023, 10-5pm, in person.

9 October – 19 November online.

Location: Bristol (two days in person); remote (over six weeks).

Corporate Watch is running a six-week, hands-on training programme on how to investigate and report on companies sustaining structural racism. This is a fully-funded programme, aimed at Black people, people of colour, and other marginalised groups.

The first part of the programme will be a two-day, in-person course in Bristol. Following this, participants will work with the support and supervision of Corporate Watch to produce a collaborative investigation on a company, or sector, involved in sustaining institutional racism.

They will receive mentoring on writing techniques, fact-checking and editing along the way.

The six-week project will focus on companies sustaining white supremacy. These could be prison, security, or border profiteers; media outlets feeding fear and xenophobia; companies perpetuating social exclusion in health, social care, or education; or arms manufacturers and other companies continuing the legacy of colonialism in the Global South.

The aim of the project is to boost knowledge and expertise among groups most on the receiving end of corporate abuses in the UK, and ultimately strengthen campaigns for justice and liberation.

This project has been funded by Network for Social Change, and made possible by the ongoing support of Joseph Rowntree Charitable Trust.

Practicalities

  • The course is free, food and accommodation will be provided, and scholarships and travel bursaries are available for eight participants who are Black, people of colour, refugees and migrants, Gypsy Roma and Traveller (GRT), ex-prisoners and other people affected by the criminal “justice” system, or those from other marginalised backgrounds. This is to reduce barriers to participation.
  • The training, mentoring time, and investigation work will be paid at a rate of £14 p/h.
  • Participants must be based in the UK, since part of the programme takes place in person.
  • There will be limited places on the weekend course available for other participants, however these will be unfunded.
  • We aim to be as flexible as possible during the six-week part of the training to accommodate those with caring responsibilities and/or other employment commitments.

Who should apply

  • This programme is for Black people, people of colour, refugees and migrants, Gypsy Roma and Traveller (GRT), ex-prisoners and other people affected by the criminal “justice” system, or people from other marginalised backgrounds.
  • We are especially interested in hearing from applicants who are active in campaigns or projects for social and racial justice.
  • If there is space, we will consider opening up the weekend course to other participants (this will be free but unpaid). Please get in touch if you are interested but do not fall under one of the above categories.

Content

The content of the two-day training session may vary slightly depending on participants, but is likely to cover:

  • The basics: understanding the different types of company structure and who makes the decisions, developing a research strategy appropriate to each case, and general research tips.
  • Core tools for corporate research: how to effectively use key resources such as Companies House, annual reports and contracts databases, as well as advanced internet search techniques.
  • Following the money: how to read and analyse company accounts.
  • Leverage: Finding other evidence of corporate malpractice, including the revolving door with government.
  • Corporate databases: How to use tools like Orbis, Capital IQ, and free alternatives such as OpenCorporates.
  • Investigating people: methods of researching shareholders, directors and owners.

We will use examples from companies specifically involved in perpetuating structural racism. Towards the end of the weekend, we will do a mapping exercise on UK companies in maintaining racial inequalities today, with a view to developing collaborative research project ideas to take forward.

Over the subsequent six-weeks, participants will work remotely to put what they have learnt into practice by completing the research project with the support of Corporate Watch staff. A total of up to 18 paid hours per participant are available for this work; hours are flexible around jobs and other commitments. In addition, six hours of funded training sessions will be delivered remotely on writing, fact-checking and editing, as well as 1:1 support.

Background and Aims

Corporate Watch is a research group established in 1996 that helps people stand up against corporations and capitalism. Our motto is ‘information for action’: we know that people can fight and win, even against powerful enemies like corporations and governments. Good information helps to understand the forces we’re up against, spot their weaknesses, and to campaign strategically and effectively.

What we do:

  • Targeted research for grassroots campaign groups, e.g. profiling a particular company, digging into its accounts, uncovering scandals, finding weak points.
  • Broader research and analysis to demystify how capitalism and specific industries work to the wider public.
  • DIY training to share our research skills. This includes our free online course: Know Your Enemy: Practical Research Training. We also offer bespoke training to groups and organisations.

We have a long history of “skilling up” groups and movements on how to do company research. But we know that this information is not always easily accessible to campaigners, community organisers and activists – especially as people need to juggle their political work around jobs and other life commitments. Since those most impacted by corporate power are often least in a position to engage with our training, we recognise that more investment of time and money is required if we are to minimise barriers to participation. Therefore, we have decided to offer this as a funded programme.

Deadline and how to apply

Please download and complete this form, telling us a bit about yourself, your motivation for applying, and any involvement in grassroots campaigning or activism you feel able to share. Return it to: training [at] corporatewatch.org by 30th August 2023.

All information will be dealt with confidentially. If you would like to send us your message via PGP encryption, you can find our key here (note, you will have to complete the form questions within the text body of the email). We will respond as promptly as we can.

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‘Floating Prisons’: The 200-year-old family business behind the Bibby Stockholm https://corporatewatch.org/floating-prisons-the-200-year-old-family-business-behind-the-bibby-stockholm/ Tue, 27 Jun 2023 15:25:57 +0000 https://corporatewatch.org/?p=12562 Bibby Line Group Limited is a UK company offering financial, marine and construction services to clients in at least 16 countries around the world. It recently made headlines after the government announced one of the firm’s vessels, Bibby Stockholm, would be used to accommodate asylum seekers on the Dorset coast. In tandem with plans to […]

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Bibby Line Group Limited is a UK company offering financial, marine and construction services to clients in at least 16 countries around the world. It recently made headlines after the government announced one of the firm’s vessels, Bibby Stockholm, would be used to accommodate asylum seekers on the Dorset coast.

In tandem with plans to house migrants at surplus military sites, the move was heralded by Prime Minister Rishi Sunak and Home Secretary Suella Braverman as a way of mitigating the £6m-a-day cost of hotel accommodation amid the massive ongoing backlog of asylum claims, as well as deterring refugees from making the dangerous channel crossing to the UK. Several protests have been organised against the project already, while over ninety migrants’ rights groups and hundreds of individual campaigners have signed an open letter to the Home Secretary calling for the plans to be scrapped, describing the barge as a “floating prison.”

Corporate Watch has researched into the Bibby Line Group’s operations and financial interests. We found that:

  • The Bibby Stockholm vessel was previously used as a floating detention centre in the Netherlands, where undercover reporting revealed violence, sexual exploitation and poor sanitation.

  • Bibby Line Group is more than 90% owned by members of the Bibby family, primarily through trusts. Its pre-tax profits for 2021 stood at almost £31m, which they upped to £35.5m by claiming generous tax credits and deferring a fair amount to the following year.

  • Management aboard the vessel will be overseen by an Australian business travel services company, Corporate Travel Management, who have previously had aspersions cast over the financial health of their operations and the integrity of their business practices.

  • Another beneficiary of the initiative is Langham Industries, a maritime and engineering company whose owners, the Langham family, have longstanding ties to right wing parties.

Key Issues

According to the Home Office, the Bibby Stockholm barge will be operational for at least 18 months, housing approximately 500 single adult men while their claims are processed, with “24/7 security in place on board, to minimise the disruption to local communities.” These measures appear to have been to dissuade opposition from the local Conservative council, who pushed for background checks on detainees and were reportedly even weighing legal action out of concern for a perceived threat of physical attacks from those housed onboard, as well as potential attacks from the far right against migrants held there.

Local campaigners have taken aim at the initiative, noting in the open letter:

“For many people seeking asylum arriving in the UK, the sea represents a site of significant trauma as they have been forced to cross it on one or more occasions. Housing people on a sea barge – which we argue is equal to a floating prison – is morally indefensible, and threatens to re-traumatise a group of already vulnerable people.”

Technically, migrants on the barge will be able to leave the site. However, in reality they will be under significant levels of surveillance and cordoned off behind fences in the high security port area.

If they leave, there is an expectation they will return by 11pm, and departure will be controlled by the authorities. According to the Home Office:

“In order to ensure that migrants come and go in an orderly manner with as little impact as possible, buses will be provided to take those accommodated on the vessel from the port to local drop off points”.

These drop off points are to be determined by the government, while being sited off the coast of Dorset means they will be isolated from centres of support and solidarity.

Meanwhile, the government’s new Illegal Migration Bill is designed to provide a legal justification for the automatic detention of refugees crossing the Channel. If it passes, there’s a chance this might set the stage for a change in regime on the Bibby Stockholm – from that of an “accommodation centre” to a full-blown migrant prison.

An initial release from the Home Office suggested the local voluntary sector would be engaged “to organise activities that keep occupied those being accommodated, potentially involved in local volunteering activity,” though they seemed to have changed the wording after critics said this would mean detainees could be effectively exploited for unpaid labour. It’s also been reported the vessel required modifications in order to increase capacity to the needed level, raising further concerns over cramped living conditions and a lack of privacy.

Bibby Line Group has prior form in border profiteering. From 1994 to 1998, the Bibby Stockholm was used to house the homeless, some of whom were asylum seekers, in Hamburg, Germany. In 2005, it was used to detain asylum seekers in the Netherlands, which proved a cause of controversy at the time. Undercover reporting revealed a number of cases abuse on board, such as beatings and sexual exploitation, as well suicide attempts, routine strip searches, scabies and the death of an Algerian man who failed to receive timely medical care for a deteriorating heart condition. As the undercover security guard wrote:

“The longer I work on the Bibby Stockholm, the more I worry about safety on the boat. Between exclusion and containment I encounter so many defects and feel so much tension among the prisoners that it no longer seems to be a question of whether things will get completely out of hand here, but when.”

He went on:

“I couldn’t stand the way prisoners were treated […] The staff become like that, because the whole culture there is like that. Inhuman. They do not see the residents as people with a history, but as numbers.”

Images of the Bibby Stockholm in 2007, while it was being used as a migrant detention centre in the Netherlands. Images: Joke Kaviaar via Indymedia NL

Discussions were also held in August 2017 over the possibility of using the vessel as accommodation for some 400 students in Galway, Ireland, amid the country’s housing crisis. Though the idea was eventually dropped for lack of mooring space and planning permission requirements, local students had voiced safety concerns over the “bizarre” and “unconventional” solution to a lack of rental opportunities.

Corporate Travel Management & Langham Industries

Although leased from Bibby Line Group, management aboard the Bibby Stockholm itself will be handled by Corporate Travel Management (CTM), a global travel company specialising in business travel services. The Australian-headquartered company also recently received a £100m contract for the provision of accommodation, travel, venue and ancillary booking services for the housing of Ukrainian refugees at local hotels and aboard cruise ships M/S Victoria and M/S Ambition. The British Red Cross warned earlier in May against continuing to house refugees on ships with “isolated” and “windowless” cabins, and said the scheme had left many “living in limbo.”

Founded by CEO Jamie Pherous, CTM was targeted in 2018 by VGI Partners, a group of short-sellers, who identified more than 20 red flags concerning the company’s business interests. Most strikingly, the short-sellers said they’d attended CTM’s offices in Glasgow, Paris, Amsterdam, Stockholm and Switzerland. Finding no signs of business activity there, they said it was possible the firm had significantly overstated the scale of its operations. VGI Partners also claimed CTM’s cash flows didn’t seem to add up when set against the company’s reported growth, and that CTM hadn’t fully disclosed revisions they’d made to their annual revenue figures.

Two years later, the short-sellers released a follow-up report, questioning how CTM had managed to report a drop in rewards granted for high sales numbers to travel agencies, when in fact their transaction turnover had grown during the same period. They also accused CTM of dressing up their debt balance to make their accounts look healthier.

CTM denied VGI Partners’ allegations. In their response, they paraphrased a report by auditors EY, supposedly confirming there were no question marks over their business practices, though the report itself was never actually made public. They further claim VGI Partners, as short-sellers, had only released the reports in the hope of benefitting from uncertainty over CTM’s operations.

Despite these troubles, CTM’s market standing improved drastically earlier this year, when it was announced the firm had secured contracts for the provision of travel services to the UK Home Office worth in excess of $3bn AUD (£1.6bn). These have been accompanied by further tenders with, among others, the National Audit Office, HS2, Cafcass, Serious Fraud Office, Office of National Statistics, HM Revenue & Customs, National Health Service, Ministry of Justice, Department of Education, Foreign Office, and the Equality and Human Rights Commission.

The Home Office has not released any figures on the cost of either leasing or management services aboard Bibby Stockholm, though press reports have put the estimated price tag at more than £20,000 a day for charter and berthing alone. If accurate, this would put the overall expenditure for the 18-month period in which the vessel will operate as a detention centre at almost £11m, exclusive of actual detention centre management costs such as security, food and healthcare.

Another beneficiary of the project are Portland Port’s owners, Langham Industries, a maritime and engineering company owned by the Langham family. The family has long-running ties to right-wing parties. Langham Industries donated over £70,000 to the UK Independence Party from 2003 up until the 2016 Brexit referendum. In 2014, Langham Industries donated money to support the re-election campaign of former Clacton MP for UKIP Douglas Carswell, shortly after his defection from the Conservatives. Catherine Langham, a Tory parish councillor for Hilton in Dorset, has described herself as a Langham Industries director (although she is not listed on Companies House). In 2016 she was actively involved in local efforts to support the campaign to leave the European Union. The family holds a large estate in Dorset which it uses for its other line of business, winemaking.

At present, there is no publicly available information on who will be providing security services aboard the Bibby Stockholm.

Images from a 2007 protest against the use of the Bibby Stockholm as a detention centre in the Netherlands. Images: Joke Kaviaar via Indymedia NL

Business Basics

Bibby Line Group describes itself as “one of the UK’s oldest family owned businesses,” operating in “multiple countries, employing around 1,300 colleagues, and managing over £1 billion of funds.” Its head office is registered in Liverpool, with other headquarters in Scotland, Hong Kong, India, Singapore, Malaysia, France, Slovakia, Czechia, the Netherlands, Germany, Poland and Nigeria (see the appendix for more). The company’s primary sectors correspond to its three main UK subsidiaries:

  • Bibby Financial Services. A global provider of financial services. The firm provides loans to small- and medium-sized businesses engaged in business services, construction, manufacturing, transportation, export, recruitment and wholesale markets. This includes invoice financing, export and trade finance, and foreign exchanges. Overall, the subsidiary manages more than £6bn each year on behalf of some 9,000 clients across 300 different industry sectors, and in 2021 it brought in more than 50% of the group’s annual turnover.

  • Bibby Marine Limited. Owner and operator of the Bibby WaveMaster fleet, a group of vessels specialising in the transport and accommodation of workers employed at remote locations, such as offshore oil and gas sites in the North Sea. Sometimes, as in the case of Chevron’s Liquified Natural Gas (LNG) project in Nigeria, the vessels are used as an alternative to hotels owing to a “a volatile project environment.” The fleet consists of 40 accommodation vessels similar in size to the Bibby Stockholm and a smaller number of service vessels, though the share of annual turnover pales compared to the group’s financial services operations, standing at just under 10% for 2021.

  • Garic Ltd. Confined to construction, quarrying, airport, agriculture and transport sectors in the UK, the firm designs, manufactures and purchases plant equipment and machinery for sale or hire. Garic brought in around 14% of Bibby Line Group’s turnover in 2021.

Prior to February 2021, Bibby Line Group also owned Costcutter Supermarkets Group, before it was sold to Bestway Wholesale to maintain liquidity amid the Covid-19 pandemic. In their report for that year, the company’s directors also suggested grant funding from MarRI-UK, an organisation facilitating innovation in maritime technologies and systems, had been important in preserving the firm’s position during the crisis.

History

The Bibby Line Group’s story begins in 1807, when Lancashire-born shipowner John Bibby began trading out of Liverpool with partner John Highfield. By the time of his death in 1840, murdered while returning home from dinner with a friend in Kirkdale, Bibby had struck out on his own and come to manage a fleet of more than 18 ships. The mysterious case of his death has never been solved, and the business was left to his sons John and James.

Between 1891 and 1989, the company operated under the name Bibby Line Limited. Its ships served as hospital and transport vessels during the First World War, as well as merchant cruisers, and the company’s entire fleet of 11 ships was requisitioned by the state in 1939.

By 1970, the company had tripled its overseas earnings, branching into ‘factoring’, or invoice financing (converting unpaid invoices into cash for immediate use via short-term loans) in the early 1980s, before this aspect of the business was eventually spun off into Bibby Financial Services. The group acquired Garic Ltd in 2008, which currently operates four sites across the UK.

Images from a 2007 protest against the use of the Bibby Stockholm as a detention centre in the Netherlands. Images: Joke Kaviaar via Indymedia NL

People

Jonathan Lewis has served as Bibby Line Group’s Managing and Executive Director since January 2021, prior to which he acted as the company’s Chief Financial and Strategy Officer since joining in 2019. Previously, Lewis worked as CFO for Imagination Technologies, a tech company specialising in semiconductors, and as head of supermarket Tesco’s mergers and acquisitions team. He was also a member of McKinsey’s European corporate finance practice, as well as an investment banker at Lazard. During his first year at the helm of Bibby’s operations, he was paid £748,000. Assuming his role at the head of the group’s operations, he replaced Paul Drescher, CBE, then a board member of the UK International Chamber of Commerce and a former president of the Confederation of British Industry.

Bibby Line Group’s board also includes two immediate members of the Bibby family, Sir Michael James Bibby, 3rd Bt. and his younger brother Geoffrey Bibby. Michael has acted as company chairman since 2020, before which he had occupied senior management roles in the company for 20 years. He also has external experience, including time at Unilever’s acquisitions, disposals and joint venture divisions, and now acts as president of the UK Chamber of Shipping, chairman of the Charities Trust, and chairman of the Institute of Family Business Research Foundation.

Michael Bibby

Geoffrey Bibby

Geoffrey has served as a non-executive director of the company since 2015, having previously worked as a managing director of Vast Visibility Ltd, a digital marketing and technology company. In 2021, the Bibby brothers received salaries of £125,000 and £56,000 respectively.

The final member of the firm’s board is David Anderson, who has acted as non-executive director since 2012. A financier with 35 years experience in investment banking, he’s founder and CEO of EPL Advisory – which advises company boards on requirements and disclosure obligations of public markets – and chair of Creative Education Trust, a multi-academy trust comprising 17 schools. Anderson is also chairman at multinational ship broker Howe Robinson Partners, which recently auctioned off a superyacht seized from Dmitry Pumpyansky, after the sanctioned Russian businessman reneged on a €20.5m loan from JP Morgan. In 2021, Anderson’s salary stood at £55,000.

Images from a 2007 protest against the use of the Bibby Stockholm as a detention centre in the Netherlands. Images: Joke Kaviaar via Indymedia NL

Ownership

Bibby Line Group’s annual report and accounts for 2021 state that more than 90% of the company is owned by members of the Bibby family, primarily through family trusts. These ownership structures, effectively entities allowing people to benefit from assets without being their registered legal owners, have long attracted staunch criticism from transparency advocates given the obscurity they afford means they often feature extensively in corruption, money laundering and tax abuse schemes.

According to Companies House, the UK corporate registry, between 50% and 75% of Bibby Line Group’s shares and voting rights are owned by Bibby Family Company Limited, which also retains the right to appoint and remove members of the board. Directors of Bibby Family Company Limited include both the Bibby brothers, as well as a third sibling, Peter John Bibby, who’s formally listed as the firm’s ‘ultimate beneficial owner’ (i.e. the person who ultimately profits from the company’s assets).

Other people with comparable shares in Bibby Family Company Limited are Mark Rupert Feeny, Philip Charles Okell, and Lady Christine Maud Bibby. Feeny’s occupation is listed as solicitor, with other interests in real estate management and a position on the board of the University of Liverpool Pension Fund Trustees Limited. Okell meanwhile appears as director of Okell Money Management Limited, a wealth management firm, while Lady Bibby, Michael and Geoffrey’s mother, appears as “retired playground supervisor.”

Banner against the Bibby in Cornwall. Image: Cornwall Resists

Key Relationships

Bibby Line Group runs an internal ‘Donate a Day’ volunteer program, enabling employees to take paid leave in order to “help causes they care about.” Specific charities colleagues have volunteered with, listed in the company’s Annual Review for 2021 to 2022, include:

  • The Hive Youth Zone. An award-winning charity for young people with disabilities, based in the Wirral.

  • The Whitechapel Centre. A leading homeless and housing charity in the Liverpool region, working with people sleeping rough, living in hostels, or struggling with their accommodation.

  • Let’s Play Project. Another charity specialising in after-school and holiday activities for young people with additional needs in the Banbury area.

  • Whitdale House. A care home for the elderly, based in Whitburn, West Lothian and run by the local council.

  • DEBRA. An Irish charity set up in 1988 for individuals living with a rare, painful skin condition called epidermolysis bullosa, as well as their families.

  • Reaching Out Homeless Outreach. A non-profit providing resources and support to the homeless in Ireland.

Various senior executives and associated actors at Bibby Line Group and its subsidiaries also have current and former ties to the following organisations:

  • UK Chamber of Shipping

  • Charities Trust

  • Institute of Family Business Research Foundation

  • Indefatigable Old Boys Association

  • Howe Robinson Partners

  • hibu Ltd

  • EPL Advisory

  • Creative Education Trust

  • Capita Health and Wellbeing Limited

  • The Ambassador Theatre Group Limited

  • Pilkington Plc

  • UK International Chamber of Commerce

  • Confederation of British Industry

  • Arkley Finance Limited (Weatherby’s Banking Group)

  • FastMarkets Ltd, Multiple Sclerosis Society

  • Early Music as Education

  • Liverpool Pension Fund Trustees Limited

  • Okell Money Management Limited

Finances

For the period ending 2021, Bibby Line Group’s total turnover stood at just under £260m, with a pre-tax profit of almost £31m – fairly healthy for a company providing maritime services during a global pandemic. Their post-tax profits in fact stood at £35.5m, an increase they would appear to have secured by claiming generous tax credits (£4.6m) and deferring a fair amount (£8.4m) to the following year.

Judging by their last available statement on the firm’s profitability, Bibby’s directors seem fairly confident the company has adequate financing and resources to continue operations for the foreseeable future. They stress their February 2021 sale of Costcutter was an important step in securing this, given it provided additional liquidity during the pandemic, as well as the funding secured for R&D on fuel consumption by Bibby Marine’s fleet.

Scandal Sheet

Bibby Line Group and its subsidiaries have featured in a number of UK legal proceedings over the years, sometimes as defendants. One notable case is Godfrey v Bibby Line, a lawsuit brought against the company in 2019 after one of their former employees died as the result of an asbestos-related disease.

In their claim, the executors of Alan Peter Godfrey’s estate maintained that between 1965 and 1972, he was repeatedly exposed to large amounts of asbestos while working on board various Bibby vessels. Although the link between the material and fatal lung conditions was established as early as 1930, they claimed that Bibby Line, among other things:

“Failed to warn the deceased of the risk of contracting asbestos related disease or of the precautions to be taken in relation thereto;

“Failed to heed or act upon the expert evidence available to them as to the best means of protecting their workers from danger from asbestos dust; [and]

“Failed to take all reasonably practicable measures, either by securing adequate ventilation or by the provision and use of suitable respirators or otherwise, to prevent inhalation of dust.”

The lawsuit, which claimed “unlimited damage”’ against the group, also stated that Mr Godfrey’s “condition deteriorated rapidly with worsening pain and debility,” and that he was “completely dependent upon others for his needs by the last weeks of his life.” There is no publicly available information on how the matter was concluded.

In 2017, Bibby Line Limited also featured in a leak of more than 13.4 million financial records known as the Paradise Papers, specifically as a client of Appleby, which provided “offshore corporate services” such as legal and accountancy work. According to the Organized Crime and Corruption Reporting Project, a global network of investigative media outlets, leaked Appleby documents revealed, among other things, “the ties between Russia and [Trump’s] billionaire commerce secretary, the secret dealings of Canadian Prime Minister Justin Trudeau’s chief fundraiser and the offshore interests of the Queen of England and more than 120 politicians around the world.”

This would not appear to be the Bibby group’s only link to the shady world of offshore finance. Michael Bibby pops up as a treasurer for two shell companies registered in Panama, Minimar Transport S.A. and Vista Equities Inc.

Looking Forward

Much about the Bibby Stockholm saga remains to be seen. The exact cost of the initiative and who will be providing security services on board, are open questions. What’s clear however is that activists will continue to oppose the plans, with efforts to prevent the vessel sailing from Falmouth to its final docking in Portland scheduled to take place on 30th June.

Call to action from Cornwall Resists

Appendix: Company Addresses

HQ and general inquiries: 3rd Floor Walker House, Exchange Flags, Liverpool, United Kingdom, L2 3YL

Tel: +44 (0) 151 708 8000

Other offices, as of 2021:

6, Shenton Way, #18-08A Oue Downtown 068809, Singapore

1/1, The Exchange Building, 142 St. Vincent Street, Glasgow, G2 5LA, United Kingdom

4th Floor Heather House, Heather Road, Sandyford, Dublin 18, Ireland

Unit 2302, 23/F Jubilee Centre, 18 Fenwick Street, Wanchai, Hong Kong

Unit 508, Fifth Floor, Metropolis Mall, MG Road, Gurugram, Haryana, 122002 India

Suite 7E, Level 7, Menara Ansar, 65 Jalan Trus, 8000 Johor Bahru, Johor, Malaysia

160 Avenue Jean Jaures, CS 90404, 69364 Lyon Cedex, France

Prievozská 4D, Block E, 13th Floor, Bratislava 821 09, Slovak Republic

Hlinky 118, Brno, 603 00, Czech Republic

Laan Van Diepenvoorde 5, 5582 LA, Waalre, Netherlands

Hansaallee 249, 40549 Düsseldorf, Germany

Poland Eurocentrum, Al. Jerozolimskie 134, 02-305 Warsaw, Poland

1/2 Atarbekova str, 350062, Krasnodar, Krasnodar

1 St Peter’s Square, Manchester, M2 3AE, United Kingdom

25 Adeyemo Alakija Street, Victoria Island, Lagos, Nigeria

10 Anson Road, #09-17 International Plaza, 079903 Singapore

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Podcast: Deportation profiteers https://corporatewatch.org/podcast-deportation-profiteers/ Sat, 24 Jun 2023 15:45:40 +0000 https://corporatewatch.org/?p=12548 Corporate Watch was recently interviewed by the Civil Fleet podcast to discuss the airlines, brokers, security firms and facilities management companies that make the UK border regime possible, as well as exploring how we can work together to resist them. The Civil Fleet is a UK-based blog and podcast that focuses on activist-led refugee rescue […]

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Corporate Watch was recently interviewed by the Civil Fleet podcast to discuss the airlines, brokers, security firms and facilities management companies that make the UK border regime possible, as well as exploring how we can work together to resist them.

The Civil Fleet is a UK-based blog and podcast that focuses on activist-led refugee rescue and support missions in the Mediterranean and across Fortress Europe. For show notes and more Civil Fleet podcasts see here. The blog can be found here.

Libsyn is not currently supported by Firefox. Therefore if you are unable to see the podcast below in your browser, you can find the episode here.

 

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The corporate plunder of Strefi Hill https://corporatewatch.org/the-corporate-plunder-of-strefi-hill/ Thu, 01 Jun 2023 12:38:20 +0000 https://corporatewatch.org/?p=12493 Since our interview with members of the Open Assembly for the Defence of Strefi Hill, Athens, the police repression has grown – but so has the resistance. With a permanent deployment of approximately 150 police on the hill reported for the past half year, the atmosphere is intimidating, to say the least. Since August 2022 […]

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Since our interview with members of the Open Assembly for the Defence of Strefi Hill, Athens, the police repression has grown – but so has the resistance.

With a permanent deployment of approximately 150 police on the hill reported for the past half year, the atmosphere is intimidating, to say the least. Since August 2022 up until the time of writing, the assembly to defend the hill has reported constant harassment of those trying to use the park, including of kids coming to play basketball or simply hang out. It has counted over forty arrests in that time, as well as other acts of violence and tear gas used against local residents who refuse to back down in the face of state intimidation. Yet the assembly has sustained resistance in myriad forms – from demos, to intergenerational festivities with traditional dancing and choirs.

Strefi Hill is more than just an inner city park. It’s a precious gathering space at the heart of a spirited neighbourhood that successive governments have sought – but failed – to subdue and assimilate. It’s a haven for anarchists, refugees and other outsiders to organise or socialise, but also a valuable community space with an open theatre, basketball courts and a playground.

And it’s a refuge for wildlife too. Wild tortoises live on the hill, and the animal has become its symbol: ancient, free, and vulnerable – but ultimately tough in its weather-beaten shell.

Since our interview, we’ve dug into the companies carving up this precious space for personal gain, hoping to inspire solidarity. We traced the financial interests back to faceless private equity firms in Northern Europe and the US – and found some wealthy Greek dynasties along the way.

Mural for Strefi Hill. Image: Open Assembly for the Defence of Strefi Hill

The investors: PRODEA

Parent companies: Invel & Castlelake

€1m (£850k) in financing for the Strefi project is provided by Prodea, with €800,000 (£687k) supplied by Athens city council.

Prodea is a property developer listed on the Athens stock exchange. Its owner describes it as “the largest Real Estate Investment Company (“REIC”) in Greece in terms of assets”, and it has at least fifty subsidiaries – mostly based in Greece and Cyprus.

The majority of Prodea’s investments are in commercial property in the form of offices. Over a third of its portfolio is rented out to the National Bank of Greece, while 10% is leased to the Greek supermarket chain Sklavenitis. It is currently in discussions about participation in the controversial Elliniko megaproject on the site of Athens’ former airport, among the world’s biggest urban redevelopment schemes.

According to company accounts, the firm appears to be doing well financially. It made just over €98m (£84m) in profit in 2022, although this was a significant drop from the previous year’s profits of around €128m (£110m).

Prodea’s chairman and president is Christophoros “Chris” Papachristophorou, who is also managing partner of the parent company, Invel. Educated at the London School of Economics, Papachristophorou cut his teeth in the world of property as global head of RREEF Opportunistic Investments, a real estate investment manager then owned by Deutsche Bank. Several other former RREEF and Deutsche Bank real estate personnel populate the Invel and Prodea management teams. This includes Papachristophorou’s wife Marianna, a London Business School graduate who owns a £5m home in Chelsea.

In an indication of the company’s potential proximity to government, another Deutsche Bank alumni and recent Invel Partner, Alexis Pipilis, happens to be Facebook friends with Sofia Mitsotakis – daughter of the current Greek Prime Minister.

Chris Papachristophorou

Invel

Prodea is owned by Invel, a Jersey-headquartered, multinational property investor and asset manager. The company specialises in “real estate and distressed debt opportunities across Europe”. It invites investment firms to contribute money alongside its own in the purchase of properties that are not considered to be profitable enough, and redevelops them.

However, Invel’s most high-profile investment isn’t a luxury hotel or a chain of supermarkets – it’s the property division of the National Bank of Greece (NBG).

Back in the early 2010s, the institutional response to the Greek debt crisis was to provide loans on the condition of massive structural changes, such as the privatisation of public assets and the implementation of austerity measures. Consequently, the real estate subsidiary of the bailed-out National Bank of Greece, then known as Pangaea, was sold off to a consortium led by Invel—a company that had been in existence for less than a year.

And Invel got a bargain. It purchased a majority share for just €653m (£566m) – however €450m was paid for by a loan provided by the bank itself (at just 2.75% interest), meaning Invel only actually paid €203m (£174m) at the time. The deal initially gave Invel access to nearly €1bn in 252 properties; as the country emerged from the worst days of the crisis, the value has since multiplied to nearly €3bn (£2.6bn) euros in 380 properties. It acquired the remaining stake in the Pangaea in 2019, renaming the business Prodea.

The Steinmetz Connection

Crisis profiteering isn’t the only unsavoury aspect of Invel’s story. It would probably like to distance itself from its most inconvenient bedfellow, disgraced diamond merchant and Israel’s former richest citizen, Beny Steinmetz.

Beny Steinmetz launched Invel back in 2013 with $400m (£343m) start-up capital provided via his firm, BSG Real Estate, part of the convoluted Beny Steinmetz Group (BSG) business empire which spans minerals, fossil fuels, property and private equity. He hired Papachristophorou as Invel’s “man on the ground” in Greece and Cyprus, and was partner at the firm until his legal woes mounted five years later. Papachristophorou remains CEO of another company in that empire, BSG Resources.

In 2020, Steinmetz was convicted of “the creation of an organized criminal group” by a Romanian court, in a case concerning the bribery of public officials for access to real estate. He was sentenced to five years’ prison in absentia.

Beny Steinmetz

A year later, Steinmetz was convicted of bribery again – this time in a case involving tens of millions of dollars worth of payments to the wife of Guinea’s then dictator, Lansana Conté, in return for mining rights. The site concerned is one of the world’s largest known deposits of iron ore in Guinea’s Simandou mountain range, home to critically endangered Western chimpanzees. In 2008, Rio Tinto – which had been given exclusive rights to the mine (and still enjoys concessions in the project) – had its license revoked. Permits were instead granted to BSG Resources, a company with no history of iron ore mining.

Steinmetz and his associates spent years trying to shut down the story through aggressive PR and legal tactics, as well as (not having quite caught on the first time) further bribery attempts.

Then in May 2022, a World Bank arbitration panel ruled that the mining rights had indeed been obtained through bribery. Yet in spite of having been sentenced to a total of ten years in prison by courts in two jurisdictions, Steinmetz appears to be walking free while he appeals his second conviction.

Former Israeli Prime Minister Ehud Olmert described Steinmetz as “the last guy you would want as an enemy”, and it no doubt helps to have family with access to power; his nephew was a partner in Jared Kushner’s property business, Kushner Companies. Steinmetz enjoys such a privileged relationship with Greece that despite the mounting evidence of corruption, a court in Athens rejected a Romanian extradition request in April 2022. He said he was “grateful to Greek justice” for this intervention.

A second figure who has been embroiled in the scandal is Shimon Menahem, another of Steinmetz’s nephews (in this case, by marriage), who invested heavily in Invel. In 2014, a Greek financial regulator noted that Papachristophorou and Menahem jointly controlled numerous companies, including exercising indirect joint control of at least one of Invel’s entities.

This map provides only a snapshot of Steinmetz’ nebulous corporate network, and many of his firms – as well as Invel’s extraordinary list of companies – are based in the tax havens Jersey, Guernsey and Luxembourg. Capitalism thrives on ambiguous corporate structures, and Steinmetz’ ability to evade the criminal justice system so far is testament to that.

Castlelake steps in

Following Steinmetz’s fall from grace, global investment firm Castlelake L.P. came to the rescue, acquiring significant shares in several Invel firms. Castlelake is now therefore the ultimate owner of Prodea, while Invel’s role in the relationship is that of a shell company – basically, a vehicle to run Prodea.

Castlelake is a multinational private equity firm specialising in planes and property. Although based in the US, the firm manages $20bn (£17bn) in assets through various funds – most of which are invested in Europe, according to financial databases.

It is headed by the founders, Rory O’Neill and Evan Carruthers. Both of them previously worked at the agribusiness conglomerate – and world’s largest private company – Cargill.

Evan Carruthers, Castlelake Co-CEO

Rory O’Neill, Castlelake Co-CEO

Engineers: Aktor

Parent company: Ellaktor

The engineering work on the hill is being carried out by Aktor. According to members of the assembly, this is being done via TOMI AVETE, an Aktor subsidiary specialising in urban developments.

Aktor is owned by Ellaktor, a major Greek construction and engineering conglomerate which operates in over thirty countries, notably in Eastern Europe and the Gulf. It works in construction, quarrying and property development, as well as building and running wind farms and wastewater treatment plants. The Group as a whole has benefited significantly from prominent public-private development projects for decades. It was, until a few years ago, led by two warring families, the Kallitsantsis clan, and the powerful Bobolas dynasty – which also owned controlling stakes in leading Greek media outlets. It is now headed by banker and private equity trader, Efthymios Bouloutas, who was convicted of corruption charges in 2018 associated with (mis)management of the now-defunct Laiki Bank. He evaded prison, walking away with a small fine.

Ellaktor has been called Greece’s second-largest producer of wind energy, running a dozen or so such farms, and now branching out into offshore wind power. Wind energy has been particularly controversial in Greece over the past couple of years, with deregulation resulting in farms being plonked on mountain tops in ecologically-sensitive habitats, and communities mobilising against the developments. Aktor also had a 5% stake in the gold mine at Skouries, Northern Greece, until this was bought by Eldorado Gold in 2020. Locals and supporters have mounted a decades-long, historic campaign of resistance to the ecologically-disastrous plan, and the mine is still not yet in production.

Efthymios Bouloutas, Ellaktor CEO

Returning to the present day, Aktor is one of several companies implicated in February’s catastrophic train collision near Tempe, Greece’s deadliest rail disaster. In 2014, Aktor was awarded the contract to upgrade the signalling system on approximately 500km of the Athens-Thessaloniki line, in a joint venture with French rail giant Alstom. But a recent report by Reporters United and Investigate Europe found that the two companies repeatedly failed to carry out their duties, and instead spent years bickering and demanding a larger contract. This was eventually approved in 2021 for an extra €13m (£11m). However, despite having been given more money, the companies were apparently still unable to get along. This led to Aktor subcontracting everything to Alstom, which had begun the work by the time of the crash.

Greek Prime Minister Mitsotakis has attributed the disaster, which killed at least 57 people, to “tragic human error”; industry experts have said that an adequate signalling system would have prevented the accident from happening.

Neither trains nor joint ventures seem to be the company’s forte. Aktor was part of another joint venture that was awarded a multi-billion euro contract to extend the Doha metro. The consortium become embroiled in a dispute with a subcontractor, which took it to court resulting in a $98.5m (£79m) fine. Aktor had to pay a substantial share of the damages.

Despite its record, Ellaktor has bid to lead the consortium that would run the new Thessaloniki metro, once completed. It has been involved in the construction of the network, although the work has been hampered by delays for years, and the company again ran into dispute with a contractor.

Protracted construction projects have resulted in a significant backlog and debt for Aktor, and it made losses of €155.5m (£133m) in 2020. Despite it being the Group’s largest company, it is now being sold off to major competitor Intrakat for €100m, in a deal expected to be completed before the end of the year.

Today, Dutch private equity firm Reggeborgh is Ellaktor’s largest shareholder, with a total stake of approximately 45%. Until recently, it also had a large shareholding in another major Greek construction firm, GEK Terna. Reggeborgh has been described as the investment vehicle of the Dutch Wessels family, which is behind the conglomerate VolkerWessels.

The next largest shareholder (with roughly 30%) is Motor Oil, a Greek petrochemicals firm chaired by billionaire shipping tycoon Vardis Vardinogiannis.

Police on Strefi Hill. Image: Open Assembly for the Defence of Strefi Hill

The managers: UNISON

Parent company: ISS

According to the Open Assembly for the Defence of Strefi Hill, the installation of the CCTV cameras, tree-cutting, fencing, concreting and cleaning has been contracted to a Greek firm called Unison.

Unison describes itself as Greece’s “market leader in the facility management industry”. Set up in the late seventies as ISS Group Hellas, it was rebranded in 2021.

Unison carries out much of the same work as its parent company, the global outsourcing giant ISS. It also has a human resources subsidiary specialising in temping work, and says that it is the first company in Greece to have received a temping license.

ISS

Danish outsourcer ISS has its roots in the security business in the early 20th century, before it branched out into cleaning, catering, site and equipment maintenance. It is now a facilities management multinational, smaller than the behemoths Sodexho and Compass Group, but larger than the British outsourcing firm Mitie. It is led by CEO Jacob Aarup-Andersen, an investment banker.

Unison represents particularly marginal revenues for ISS, at less than 1% and isn’t even included in ISS’s list of significant subsidiaries. ISS’s most important market is the UK, where the majority (15%) of its global income is generated. It is headquartered in Copenhagen, Denmark.

ISS is a publicly-traded company. Kirkbi A/S, a private holding of the Danish Kirk Kristiansen family (owner of the world’s most profitable toy company, Lego), has a 17% shareholding in the business.

British-based private equity firm Longview Partners has a smaller (7%) shareholding. Ownership of Longview can be traced back to Ernesto Bertarelli, Swiss billionaire and until recently, Switzerland’s richest person. Bertarelli recently bought a £92m home in Belgravia, London using wealth which ultimately derives from his family’s former pharmaceutical business.

Conclusion

Tugging on the threads of Strefi Hill unravels a patchwork of companies and individuals united in self-interest and corporate greed, from faceless US investors and a corrupt Israeli diamond merchant, to an LSE-educated banker and a Swiss billionaire. The cases of Aktor and Steinmetz show how proximity to power means they can keep getting the contracts, no matter how corrupt or incompetent they may be.

These corporate interests can be traced far beyond Athens, with wealth being funnelled back to countries such as the UK, Switzerland, Netherlands, Denmark and the US. The attack on the hill is part of a global struggle against the suppression of dissent, alternative lifestyles and free public spaces. But with collective resistance and solidarity, victory against the devastating forces of gentrification is within reach.

Click to enlarge

Appendix: Addresses

See the links for more locations

  • Prodea

    Athens: Chrisospiliotissis 9, 105 60.

  • InvelAthens: (same as Prodea) Chrisospiliotissis 9, 105 60.London: 1st Floor, 26 Grosvenor Gardens, London, SW1W 0GT.(See the link for more)
  • Castlelake

    London: 15 Sackville Street, W1S 3DJ.

  • Unison

    Athens: Andrea Siggrou 194, Kallithea 176 71.

  • ISS

    UK: 1 Brooklands Drive Brooklands, Weybridge, Surrey, KT13 0SL

  • Ellaktor

    Athens: Ermou 25, Kifisia 145 64.

  • Aktor: As Ellaktor

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2022 UK charter deportations: a balance sheet https://corporatewatch.org/2022-uk-charter-deportations-a-balance-sheet/ Wed, 15 Mar 2023 14:49:03 +0000 https://corporatewatch.org/?p=12292 In 2022, the UK deported 1,566 people to nine countries on 62 specially-chartered flights (1) flown by eight airlines (2). The figures are a little higher than 2021, when 1,305 people were deported on 65 charter flights. Combining Freedom of Information requests by Patrice Petit with flight data available via flight tracking websites (3), Corporate […]

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In 2022, the UK deported 1,566 people to nine countries on 62 specially-chartered flights (1) flown by eight airlines (2). The figures are a little higher than 2021, when 1,305 people were deported on 65 charter flights. Combining Freedom of Information requests by Patrice Petit with flight data available via flight tracking websites (3), Corporate Watch can reveal which companies carried out these flights, and how much money the Home Office paid them to do it.

For analysis on the previous year’s flights, see here.

The flights and the people

In terms of destinations, deportation charter flights in 2022 followed similar patterns to 2021 and previous years. Albania was by far the most frequent destination, with 35 flights deporting approximately 900 people, more than all other nationalities combined. Next were three EU countries: Romania, Poland and Lithuania, receiving 11, 8 and 5 flights, for an approximate total of 300, 145 and 94 people respectively. Flights to Ghana and Nigeria (21 people), Jamaica (7 people), Vietnam (40 people) and Zimbabwe (2 flights, 35 people) accounted for the rest. Five flights scheduled to Iraq, Jamaica, Lithuania, Poland and Rwanda were cancelled.

The most recent immigration statistics published by the Home Office state that the “vast majority of enforced returns” were of so-called Foreign National Offenders (“FNO”). These were overwhelmingly to European countries, but also included Ghana, Jamaica, Nigeria and Zimbabwe. The Windrush scandal showed how deportations to these post-colonial territories are systemically racist in nature, and particularly susceptible to procedural abuse. Many of those on the planes will be more at home in the UK than anywhere else, regardless of any irregularities in their immigration status.

The use of charter flights to deport criminalised people is a point we are continually reminded of by politicians to serve as their self-evident justification. Home Office propaganda focuses on the sometimes severe crimes of a few deportees. Yet according to activists and detainee support groups, such as volunteers with the Association of Visitors to Immigration Detention, most people are picked up for minor offences. Many deportees on these flights have human trafficking claims, and many have lived most of their lives in the UK. Despite extensive community ties, these people nevertheless face the additional punishment of becoming completely cut off from those communities after serving their criminal sentence.

There is also an ever-increasing conflation of so-called “foreign criminals” and asylum seekers. The Nationality and Borders Act, which entered into force last summer, criminalised “irregular arrival” so that anyone who comes autonomously to the UK to seek asylum can readily be declared and convicted as a criminal. This intentional confusion between asylum seekers and foreign criminals was evident in reporting on the cancelled Iraq flight; comments from the Home Office meant it was originally described as carrying foreign criminals, when those due to fly were later found to be refused asylum seekers.

Over the years we have seen how the government targets huge numbers of people ahead of a charter flight in the hope that not all will be able to receive the timely legal advice needed to stay their deportation. The 18 May charter flight to Jamaica was originally scheduled for more than 100 people, but left with just seven on board after many were able to cancel their deportation pending a legal review. Several dozen detainees at Colnbrook IRC, not due to be deported that day, had also protested the flight inside the detention centre in a bid to prevent three people from being taken.

Targeting Albanians

The Home Office’s immigration statistics report shows that Albanians accounted for 25% of total “enforced returns” from the UK, as well as a majority of FNO deportations. The deportation of Albanians, not only as “criminals” but “Channel crossers”, was key to Home Office propaganda throughout the last year showing its resolve to “stop the boats”. The Refugee Council estimated that 15,569 Albanians crossed the Channel in 2022 – by far the leading nationality – but they had an asylum acceptance rate at first decision of just 16%. Unable to deport asylum seekers from other countries due largely to the ending of the Dublin mechanism after Brexit – a spectacular own goal for previous Conservative governments – the deportation of Albanian asylum seekers has become a convenient substitute.

Albanians have become a catch-all scapegoat for the Home Office, which simultaneously alludes to them as dangerous foreign criminals, bogus asylum seekers and Channel crossers in its press releases and social media posts. The current rhetoric against Albanians is openly persecutory, with Minister of Immigration Robert Jenrick recently celebrating:

“the fantastic staff who are working round the clock to find the Albanians, to detain them, to put them onto coaches, to take them to the airport and get them back to Tirana“.

Following on previous agreements, in December the UK and Albanian governments agreed a new deal which would reportedly allow “13,000 who crossed the Channel last year to be removed from Britain on weekly deportation flights” by fast-tracking asylum claims and prohibiting Albanians from accessing modern slavery protections. We expect Albanians to continue being a prime target for deportation charter flights into 2023, with Rishi Sunak recently telling Piers Morgan they will “ratchet up over the year”.

The companies

Airline Total flights
Privilege Style 25
Titan 21
AirTanker 7
Corendon 3
Hi Fly 2
Iberojet 2
ETF 1
flyPOP 1

Two airlines raked in almost all of the money doing deportations for the Home Office in 2022: Spanish airline Privilege Style, and Stansted-based Titan Airways. Both should be well-known to anti-deportation activists, and have been lining their pockets helping successive British and other European governments ruin people’s lives for years. These two companies have proven themselves consistently the UK’s most frequent deporters, and key cogs in this misery machine.

In 2022 these two airlines lent their aircraft and crew to the Home Office 46 times, three-quarters of all mass deportation flights. But analysing the flight numbers of the mass deportations we identified shows aircraft from other companies flying under Titan (AWC) and Privilege Style (PVG) codes. This implies that these two companies sometimes subcontract out their dirty work, and were potentially responsible for 54 – or 87% – of flights overall (4).

The government seems to have turned to other companies for its less frequent and much longer deportations to countries like Zimbabwe and Vietnam. The other airlines identified deported people to countries beyond the weekly flights to Albania and EU member states, and were likely to have been contracted through deportation fixer Air Partner (see more in our recent profile here). Hi Fly, the Portuguese charter airline which led the Home Office’s pre-Brexit drive of asylum seekers in late 2020, deported seven people to Jamaica on 18 May and then nine people to Zimbabwe on 7 September. It also appears to have used its partner flyPOP’s plane 9H-PTP to deport a total of 21 people to Ghana and Nigeria in June.

Hi Fly appeared to have silently stepped back from deportation charters after being exposed by Corporate Watch in 2020, but has since proven it is still happy to go the distance to tear apart a family for the Home Office, despite its proclaimed support for refugee causes.

Iberojet, formerly Evelop!, is another Spanish airline with a history of collaboration with the Home Office. Last year it deported 40 people to Vietnam in January, and 26 to Zimbabwe in March (see our 2021 profile on Iberojet/Evelop! here). Along with Air Nostrum, Iberojet has just been awarded another contract to carry out Spain’s deportation flights for the next 16 months.

There was one exception to the above pattern. In November a new airline began performing deportation work on the regular Albania route for the Home Office: Corendon Airlines. According to the Berlin-based No Border Assembly and their Deportation Alarm project, the holiday airline first entered the charter deportation market during the 2020 Covid pandemic. The company headquarters are in Turkey and Malta, however its Dutch subsidiary, Corendon Dutch Airlines, flies all its deportation charters for the company, often with the same Boeing 737-registered PH-CDH. Apart from its three flights last year, at the time of writing Corendon has already flown two deportation charter flights for the Home Office in 2023 (Romania on 31 January and Albania on 16 February). This company, a proven deportation provider to EU states, may continue to carry out work for the Home Office in future as it appears to be a cheaper alternative than its former go-to charter firms, Titan and Privilege Style.

The cancelled Rwanda flight

Despite regular deportation flights taking off each week, public consciousness of the UK’s deportation planes in 2022 was dominated by one which never took off: Privilege Style’s scheduled flight from Boscombe Down MOD to Kigali, Rwanda. Investigations revealed that the people forced onto that plane were physically attached to their seats with waist restraint belts by Mitie guards who used “pain-inducing techniques” to stop them self-harming as a way to resist their expulsion. The Privilege Style crews may have heard, if not directly witnessed, this torture, but still appeared willing to take off nonetheless. Luckily this flight was halted by an eleventh-hour intervention by the European Court of Human Rights, and no other has been scheduled while the UK’s policy to deport asylum seekers to Rwanda is undergoing legal challenges in the courts.

Following campaigning from anti-deportation activists in the UK and Spain—including interrupting the World Aviation Festival and going to Privilege Style’s headquarters to present it the “Worst Airline in the World Award” (a golden plane crashing into a pile of shit) Privilege Style announced on 18 October that they would not fly any future deportation flights to Rwanda. While Titan and AirTanker have made similar statements, Hi Fly and Iberojet refuse to make the same commitment. However, Privilege Style’s apparent change of tune on Rwanda in the face of public pressure did not stop it from continuing to fly deportations for the Home Office (or other European countries). In fact, just the day after its announcement it deported 32 people to Albania, followed by another three deportations to Poland and Albania within the next month.

After 17 November there were no further deportation charter flights flown by Privilege Style from the UK in 2022. This led some to wonder if the “Home Office’s deportation airline of last resort” had pulled out of the market for good, or perhaps was being punished for withdrawing its cooperation for flights to Rwanda. But on 2 February 2023, Privilege Style again flew another mass deportation to Albania – proving it remains one of Europe’s most unabashed deportation profiteers, so far unfazed by collective actions.

The money

The costs to the Home Office for all its chartered deportation flights in 2022 are as follows:

Period Total costs Total flights
1 January – 31 March £3,614,460.89 19
1 April – 31 May £1,808,016.35 10 (+1 cancelled)
1 June – 1 September £3,470,545.82 16 (+3 cancelled)
1 September – 31 December £3,428,111.53 18 (+1 cancelled)

The per monthly breakdown for the final four months of the year is:

September £1,294,838.66 5 flights
October £882,039.28 5 flights
November £675,484.38 4 flights
December £575,749.21 4 flights

Based on the FOI data, we estimate that the total yearly costs for the 62 flights (plus five cancelled) to have been £12,145,000 (5), slightly more than the £11,744,522.33 from 2021. This excludes fees paid to Mitie for the guards to keep the people in their seats (at least three “escorts” per deportee), as well as other costs which may have been billed to the Home Office later. We estimate the average per-flight cost in 2022 to have been £180,000, but the real costs will fluctuate depending upon the destination and airline, amongst other factors.

This year’s data provided more insight into per-flight costs than previous investigations. Flights to distant destinations cost the Home Office substantially more than deportations to European countries. Costs in November were £100,000 higher than December despite being for basically the same four flights, three to Albania and a fourth to Romania. The difference: a plane had been scheduled to deport people to Jamaica on 9 November. This flight was cancelled, and would have likely cost substantially more had it gone ahead.

Cancelled flights therefore still entail significant costs. 19 flights were scheduled in both the three-month period June to September and the four-month period September to January. Total costs were £40,000 more in the earlier period despite the cancellation of two more flights, including Privilege Style’s planned deportation to Rwanda.

We can also see that charter airlines like Privilege Style or Titan that brag about serving VIPs, politicians, sports teams and the like are the most expensive, yet are still used most often. Comparing average costs in October (£176,407.86) to December (£143,937.30) we see that per-flight costs were around £30,000 lower in December for similar destinations. The difference this time: deportations in December were carried out by Corendon, and not Privilege Style (other than the two constants done by Titan each month).

Looking ahead

Charter deportations represent a minority of all deportations from the UK (6). Deportation charters have been consistently criticised for their exorbitant costs alongside the relatively small number of deportees who end up on the flights after people make their cases for remaining in the UK to the courts. However, claiming per-flight costs are too high or the number of people is too low to justify specially chartering an entire plane misses the point of these mass deportations. Above all, they are meant to serve as spectacular displays of immigration enforcement action for the government in power at the time. For a premium, ministers get to Tweet regularly about mass deportations of foreign criminals and other scapegoats to prove to anti-migrant constituents their dedication to stopping “illegal immigration” or punishing those who “game the asylum system”.

Aside from pandering to their base, the Home Office is also likely happy to fork over huge sums for deportation charters because it imagines that they deter others from coming to the UK. Since at least August 2020, rapid response deportation attempts have been a key tactic to “stop the boats”, and were recently reprioritised by Prime Minister Rishi Sunak. However, as small boat arrivals continue to rise year-on-year, while only generating 45% of total asylum claims in 2022, this strategy has proven not only unsuccessful but unnecessary. The Rwanda plan which was supposed to deliver a deterrent effect has apparently not fazed anyone waiting in France for their chance to cross, but rather only re-traumatised survivors of torture and led others who have had to flee to the UK for their lives to now contemplate suicide here.

In lieu of the dramatic Rwanda charter deportations Home Secretary Suella Braverman “dreams” of seeing, last year shows the much more mundane (but no less violent and abusive) reality of a charter deportation system churning through our communities each week. Albanians are currently prime targets, but this could easily become other nationalities and cohorts, especially as the predominant nationalities of Channel crossers shift. We saw glimpses of this last year with the deportation charter flights to Vietnam in January and then the cancelled flight (for “operational reasons”) of Kurdish people to Iraq in May, the first planned flight to the country in a decade. These came off the back of the large number of Vietnamese people and Iraqis travelling to the UK by boat in late 2021 and early 2022, and, like deportations to Albania, could be intended to dissuade others from those specific countries from following.

Although deportations to Rwanda are currently not happening due to legal challenges, and there is no longer a returns agreement for European countries, we know the government is keen to negotiate other “third-country” agreements for the deportation of asylum seekers. It is now clearing the legal ground necessary to do such returns at scale with its recently-published Illegal Migration Bill, currently in its second reading in the House of Commons.

If efforts to allow the mass deportation of people who have not even had the opportunity to seek asylum are ever successful, we must assume that the government will make full use of charter flights if for no other reason than for the dramatic statement that a deportation plane taking off makes. The bottom line, however, is that for these flights to go ahead, someone has to be willing to fly them. We saw last year that even the very worst companies can be pushed into refusing to carry out this work through sustained international action. Therefore we must continue to pressure all the deportation profiteers to ensure that when the Home Office tries to carry out its next deportation charter, there is no one left they can turn to to help them do it.

Appendix

1Three flights deported people to two destinations. For these flights data from the Home Office, unfortunately, did not specify how many people were deported to each individual country, meaning figures for total number deported to Albania, Ghana, Nigeria and Romania are approximate.

2Two flights – flyPOP’s deportation to Nigeria and Ghana on 26 June and ETF Airway’s deportation from Doncaster to Albania on 15 September – may have been flown on behalf of Hi Fly and Privilege Style respectively.

3 2022 charter flight data table

4The seven flights MoD contractor AirTanker flew with its Airbus A330 registered G-VYGK all took place under Titan’s AWC callsign, rather than AirTanker’s own TOW. ETF’s 15 September deportation from Doncaster to Tirana flew as PVG7447. If we add these flights to their respective tallies, Titan and Privilege Style flew 54 or 87% of the total 62 flights. Whether these were also flown with their own aircrews, accustomed to what they would have faced during a deportation charter or not, we cannot say for now.

5The total yearly costs are £12,321,134.59; however, note that 1 September’s flight to Albania was double counted. We can estimate the cost of this flight to have been ~£175,000 less, seeing that the average cost of a flight in October (4 flights to Albania and 1 to Poland, 3 flown by Privilege Style) was £176,407.86.

6According to the most recent Home Office immigration statistics (for the year ending December 2022) there were 3,521 enforced returns, of which the “vast majority” were FNOs and 49% percent EU nationals.

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Air Partner: the Home Office’s little-known deportation fixer https://corporatewatch.org/air-partner-the-home-offices-deportation-fixer/ Fri, 06 Jan 2023 13:54:46 +0000 https://corporatewatch.org/?p=12137 Air Partner and Carlson Wagonlit are the grease spinning the wheels of the UK deportation machine, organising logistics for mass-deportation flights for years. International travel megacorp Carlson Wagonlit Travel (CWT) holds a £5.7 million, seven-year contract with the Home Office for the “provision of travel services for immigration purposes”, as it has done for nearly […]

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Air Partner and Carlson Wagonlit are the grease spinning the wheels of the UK deportation machine, organising logistics for mass-deportation flights for years.

International travel megacorp Carlson Wagonlit Travel (CWT) holds a £5.7 million, seven-year contract with the Home Office for the “provision of travel services for immigration purposes”, as it has done for nearly two decades. However, a key part of its work – the chartering of aircraft and crew to carry out the deportations – has been subcontracted to a little-known aviation charter outfit called Air Partner.

Summary

Digging deeper into Air Partner, we found a company which has been quietly organising mass deportations for the Home Office for years. We also learnt that:

  • It likely arranged for the airline Privilege Style to carry out the aborted flight to Rwanda, and will seek another airline if the Rwanda scheme goes ahead.
  • It has organised deportation logistics for the US and several European governments.
  • It is currently one of four beneficiaries of a €15 million framework contract to arrange charter deportations for the European Coast Guard and Border Agency, Frontex.
  • The company grew off the back of military contracts, with profits soaring during the ‘War on Terror’, the Arab Spring, and the Covid-19 pandemic.
  • Its regular clients include politicians, celebrities and sports teams, and it recently flew teams and fans to the FIFA World Cup in Qatar.
  • Air Partner was bought in spring 2022 by American charter airline, Wheels Up, but that company is in troubled financial waters.

Air Partner: Home Office deportation broker

In Carlson Wagonlit’s current contract award notice, published on the EU website Tenders Electronic Daily, the “management and provision of aircraft(s) charter services” is subcontracted to Air Partner – a detail which is redacted in documents on the UK government’s procurement site. In other words, when the Home Office wants to carry out a mass deportation flight, the task of finding the airline is delegated to Air Partner.

The contract stipulates that for each charter flight, Air Partner must solicit bids from at least three potential airlines. Selection is on the basis of value for money. However, the contract also states that “the maximum possible flexibility “ is expected from the carrier in terms of dates and destinations. The winning bidder must also be morally comfortable with the work, although it is not clear at what point in the process a first-time deportation airline is fully informed of the nature of the task.

The contract suggests that airlines like Privilege Style, Titan Airways, Hi Fly and TUI, therefore, owe their entry into the UK deportation business to Air Partner, which effectively acts as gatekeeper to the sector. Meanwhile, Carlson Wagonlit books the tickets, oversees the overall operation, arranges deportations on scheduled flights, and liaises with the guards who physically enforce the expulsion (currently supplied by the company that runs Manston camp, Mitie, in a Home Office escorting contract that runs until 2028).

The latest deal between the Home Office and Carlson Wagonlit was awarded in 2017 and runs until 31st October 2024. It is likely that Air Partner makes money through a commission on each deportation flight.

Flying for Frontex

2021 deportation on a Privilege Style flight from Germany. Photo: Michael Trammer.

Yet Air Partner isn’t just the UK government’s deportation dealer. Its Austrian branch is currently one of four companies which organise mass expulsions for the European Coast Guard and Border Agency, Frontex, in a €15 million framework contract that was renewed in August 2022. A framework contract is essentially a deal in which a few companies are chosen to form a pool of select suppliers of particular goods or services, and are then called upon when needed. The work was awarded without advertising, which Frontex can do when the tender is virtually identical as in the previous contract.

Frontex organises deportation charter flights – either for multiple EU states at a time (where the plane stops to pick up deportees from several countries) – or for a single state. The Agency also arranges for individuals to be deported on regular commercial flights.

Air Partner’s work for Frontex is very similar to its work for the Home Office. It sources willing aircraft and crew, obtains flight and landing permits, and organises hotels – presumably for personnel – “in case of delays”. The other beneficiaries of the framework contract are Air Charter Service, Professional Aviation Solutions, and AS Aircontact.

Air Charter Service is a German company, sister of a Surrey-based business of the same name, and is owned by Knightsbridge private equity firm, Alcuin Capital Partners. Professional Aviation Solutions is another German charter company, owned by Skylink Holding. Finally, Norwegian broker AS Aircontact is a subsidiary of travel firm Aircontact Group, ultimately owned by chairman Johan Stenersen. AS Aircontact has benefited from the Frontex deal for many years.

The award was given to the four companies on the basis of lowest price, with each bidder having to state the price it was able to obtain for a range of specified flights. The companies then bid for specific deportations, with the winner being the one offering best value for money. Air Partner’s cut from the deal in 2021 was €2.7 million.

The contract stipulates the need for total secrecy:

[The contractor] Must apply the maximum discretion and confidentiality in relation to the activity… must not document or share information on the activity by any means such as photo, video, commenting or sharing in social media, or equivalent.

The Frontex award effectively means that Air Partner and the other three firms can carry out work on behalf of all EU states. But the company’s involvement with deportations doesn’t stop there: Air Partner has also profited for years from similar contracts with a number of individual European governments.

The company has done considerable work in Ireland, having been appointed as one of its official deportation brokers back in 2005. Ten years later, the Irish Department of Justice was recorded as having paid Air Partner to carry out a vaguely-described “air charter” job (on a web page that is no longer available), while in 2016 the same department paid Air Partner €240,000 for “returns air charter” – government-speak for deportation flights.

Between August 2021 and February 2022, the Austrian government awarded the company six Frontex-funded deportation contracts, worth an estimated average of €33,796.

The company also enjoys a deportation contract with the German government, in a deal reviewed annually. The current contract runs until February 2023.

Finally, Air Partner has held deportation contracts with US Immigration and Customs Enforcement (ICE) and has been involved in deporting Mexican migrants to the US as far back as the early 2000s.1

Relationship with the airlines

In the first half of 2021, 22 of the EU’s 27 member states participated in Frontex flights, with Germany making far greater use of the ‘service’ than any other country. The geographic scale of Air Partner’s work gives an indication of the privileged access it has as gatekeeper to Europe’s lucrative ‘deportation market’, and ultimately, the golden land of government contracts more generally.

For example, British carrier Titan Airways – which has long carried out deportations for the Home Office – only appears to have broken into this market in Germany and Austria in 2018 and 2019, respectively. As Corporate Watch has documented, other airlines such as Privilege Style, AirTanker, Wamos and Iberojet (formerly, Evelop) regularly run deportation flights for a number of governments, including the UK. We can assume that Air Partner’s relationships with the firms are key to these companies’ ability to secure such deals in new markets.

Some of these relationships are clearly personal: Alastair Wilson, managing director of Titan Airways, worked as trading manager for Air Partner for seven years until he left that firm for Titan in 2014. By 2017, Titan was playing a major role in forcible expulsions from the UK.

The business: from military money to deportation dealer

Air Partner’s origins are in military work. Founded in 1961, the company started its life as a training centre which helped military pilots switch to the commercial sector. Known for much of its history as Air London, it has enjoyed extensive Ministry of Defence deals for troop rotations and the supply of military equipment. Up until 2010, military contracts represented over 60% of pre-tax profits. However, in recent years it has managed to wean itself off the MOD and develop a more diverse clientele; by 2018, the value of military contracts had dropped to less than 3% of profits.

The company’s main business is in brokering aircraft for charter flights, and sourcing planes from its pool of partner airlines at the request of customers who want to hire them. It owns no aircraft itself. Besides governments and wealthy individuals, its current client base includes “corporates, sports and entertainment teams, industrial and manufacturing customers, and tour operators.”

Its other source of cash is in training and consultancy to government, military and commercial customers through three subsidiaries: its risk management service Baines Simmons, the Redline Security project, and its disaster management sideline, Kenyon Emergency Services. Conveniently, while the group’s main business pumps out fossil fuels on needless private flights, Kenyon’s disaster management work involves among other things, preparing customers for climate change-induced natural disasters.

Despite these other projects, charter work represents the company’s largest income stream by far, at 87% of the group’s profits. Perhaps unsurprisingly, the majority of this is from leasing large jets to customers such as governments, sports teams and tour operators. Its second most lucrative source of cash is leasing private jets to the rich, including celebrities. Finally, its freight shipments tend to be the least profitable division of its charter work.

The company’s charter division continues to be “predominantly driven by government work”.2 It has been hired by dozens of governments and royal families worldwide, and almost half the profits from its charter work now derive from the US, although France has long been an important market too.

Ferrying the mega-rich

Meanwhile, Air Partner’s work shuttling politicians and other VIPs no doubt enables the company to build up its bank of useful contacts which help it secure such lucrative government deals. Truly this is a company of the mega-rich: a “last-minute, half-term holiday” with the family to Madeira costs a mere £36,500 just for the experience of a private jet. It was the first aircraft charter company to have held a Royal Warrant, and boasts of having flown US election candidates and supplying George W Bush’s press plane.3

The “group charter” business works with bands and sports teams. The latter includes the Wales football team, Manchester City, Manchester United, Chelsea and Real Madrid, while the Grand Prix is “always a firm fixture in the charter calendar”.4 It also flew teams and fans to the controversial 2022 FIFA World Cup in Qatar.5

Crisis profiteer: the War on Terror, the Arab Spring & Covid-19

Air Partner has cashed in on one crisis after the next. Not only that, it even contributes to one, and in so doing multiplies its financial opportunities. As military contractor to belligerent Western forces in the Middle East, the company is complicit in the creation of refugees – large numbers of whom Air Partner would later deport back to those war zones. It feeds war with invading armies, then feasts on its casualties.

The company reportedly carried at least 4,000t of military supplies during the first Gulf War. The chairman at the time, Tony Mack, said:

The Gulf War was a windfall for us. We’d hate to say ‘yippee, we’re going to war’, but I guess the net effect would be positive.6

And in its financial records over the past twenty years, three events really stand out: 9/11 and the ‘War on Terror’, the Arab Spring, and the Covid-19 pandemic.

9/11 and the subsequent War on Terror was a game changer for the company, marking a departure from reliance on corporate customers and a shift to more secure government work. First – as with the pandemic – there was a boom in private jet hire due to “the number of rich clients who are reluctant to travel on scheduled services”.7

But more significant were the military contracts it was to obtain during the invasions of Afghanistan and Iraq. During the occupation of Afghanistan, it “did a lot of freighting for the military”,8 while later benefiting from emergency evacuation work when coalition foreign policy came to its inevitably grim conclusion in 2021.

It enjoyed major military assignments with coalition forces in Iraq,9 with the UK’s eventual withdrawal resulting in a 19% drop in freight sales for the company. At one point, Air Partner lamented that its dip in profits was in part due to the temporary “cessation of official hostilities” and the non-renewal of its 2003 “Gulf contracts”.

9/11 and the aggression that followed was a boon for Air Partner’s finances. From 2001-02, pre-tax profits increased to then record levels, jumping 85% from £2.2 million to £4 million. And it cemented the company’s fortunes longer-term; a 2006 company report gives insight into the scale of the government work that went Air Partner’s way:

… over the last decade alone, many thousands of contracts worth over $500m have been successfully completed for the governments of a dozen Western Powers including six of the current G8 member states.

Two years on, Air Partner’s then-CEO, David Savile, was more explicit about the impact of the War on Terror:

Whereas a decade ago the team was largely servicing the Corporate sector, today it majors on global Government sector clients. Given the growing agenda of leading powers to pursue active foreign policies, work levels are high and in today’s climate such consistent business is an important source of income.

Profits soared again in 2007, coinciding with the bloodiest year of the Iraq war – and one which saw the largest US troop deployment. Its chairman at the time said:

The events of 9/11 were a watershed for the aviation industry…since then our sales have tripled and our profitability has quadrupled. We now expect a period of consolidation… which we believe will present longer term opportunities to develop new business and new markets.

It seems likely that those “new markets” may have included deportation work, given that the first UK charter deportations were introduced by the New Labour government in 2001, the same year as the invasion of Afghanistan.

Another financial highlight for the company was the 2011 Arab Spring, which contributed to a 93% increase in pre-tax profits. Air Partner had earlier won a four-year contract with the Department for International Development (DfID) to become its “sole provider of passenger and freight air charter services”, and had been hired to be a charter broker to the Foreign and Commonwealth Office Crisis Centre.

As people in Libya, Egypt, Bahrain and Tunisia took to the streets against their dictators, the company carried out emergency evacuations, including for “some of the largest oil companies”. A year later, it described a “new revenue stream from the oil & gas industry”, perhaps a bonus product of the evacuation work.

Finally, its largest jump in profits was seen in 2021, as it reaped the benefits of converging crises: the pandemic, the evacuation of Afghanistan, and the supply chain crisis caused by Brexit and the severe congestion of global sea-shipping routes. The company was tasked with repatriation flights, PPE shipments, and “flying agricultural workers into the UK from elsewhere in Europe”, as well as responding to increased demand for “corporate shuttles” in the UK and US.10 Pre-tax profits soared 833% to £8.4 million. It made a gross profit of approximately £45 million in both 2021 and 2022. The company fared so well in fact from the pandemic that one paper summed it up with an article entitled “Air Partner takes off after virus grounds big airlines”.

While there is scant reporting on the company’s involvement in deportations, The Times recently mentioned that Air Partner “helps in the deporting of individuals to Africa and the Caribbean, a business that hasn’t slowed down during the pandemic”. In a rare direct reference to deportation work, CEO Mark Briffa responded that it:

…gives Wheels Up [Air Partner’s parent company] a great opportunity to expand beyond private jets…It was always going to be a challenge for a company our size to scale up and motor on beyond where we are.

Yet Briffa’s justification based on the apparent need to diversify beyond VIP flights looks particularly hollow against the evidence of decades of lucrative government work his company has enjoyed.

When asked for comment, a spokesperson from the company’s PR firm TB Cardew said:

As a policy, we do not comment on who we fly or where we fly them. Customer privacy, safety and security are paramount for Air Partner in all of our operations. We do not confirm, deny or comment on any potential customer, destination or itinerary.

The parent company: Wheels Up

Kenny Dichter, Wheels Up CEO

Air Partner was bought in spring 2022 for $108.2 million by Wheels Up Experience Inc, a US charter airline which was recently listed on the New York Stock Exchange. The company calls itself one of the world’s largest private aviation companies, with over 180 owned or long-term leased aircraft, 150 managed fleet (a sort of sharing arrangement with owners), and 1,200 aircraft which it can hire for customers when needed.

In contrast to Air Partner, its new owner is in deep trouble. While Wheels Up’s revenues have increased considerably over the past few years (from $384 million in 2019 to $1.2 billion in 2022), these were far outweighed by its costs. It made a net loss in 2021 of $190 million, more than double that of the previous year. The company attributes this to the ongoing impact of Covid-19, with reduced crew availability and customer cancellations. And the situation shows no sign of abating, with a loss of $276.5 million in the first nine months of this year alone. Wheels Up is responding with “aggressive cost-cutting”, including some redundancies.

Wheels Up is, in turn, 20% owned by Delta Airlines, one of the world’s oldest and largest airlines. Mammoth asset manager Fidelity holds an 8% share, while Wheels Up’s CEO Kenneth Dichter owns 5%. Meanwhile, the so-called ‘Big Three’ asset managers, BlackRock, Vanguard and State Street each hold smaller shareholdings.

Among its clients, Wheels Up counts various celebrities – some of whom have entered into arrangements to promote the company as ‘brand ambassadors’. These apparently include Jennifer Lopez, American football players Tom Brady, Russell Wilson, J.J. Watt, Joey Logano, and Serena Williams.

Given Wheels Up’s current financial situation, it can be safely assumed that government contracts will not be easily abandoned, particularly in a time of instability in the industry as a whole. At the same time, in view of the importance of Wheels Up’s brand and its VIP clientele, anything that poses a risk to its reputation would need to be handled delicately by the company.

It also remains to be seen whether Wheels Up will use its own fleet to fulfil Air Partner’s contracting work, and potentially become a supplier of deportation planes in its own right.

Top people

Mark Briffa, Air Partner CEO and Wheels Up president

Air Partner has been managed by CEO Mark Briffa since 2010. A former milkman and son of Maltese migrants, Briffa grew up in an East Sussex council house and left school with no O or A levels. He soon became a baggage handler at Gatwick airport, eventually making his way into sales and up the ladder to management roles. Briffa is also president of the parent company, Wheels Up.

Ed Warner OBE is the company’s chair, which means he leads on its strategy and manages the board of directors. An Oxbridge-educated banker and former chair of UK Athletics, Warner no doubt helps Air Partner maintain its connections in the world of sport. He sits on the board of private equity fund manager HarbourVest, and has previously been chairman of BlackRock Energy and Resources Income Trust, which invests in mining and energy.

Kenny Dichter is founder and CEO of Air Partner’s US parent company, Wheels Up. Dichter is an entrepreneur who has founded or provided early investment to a list of somewhat random companies, from a chain of ‘wellness’ stores, to a brand of Tequila.

Tony Mack was chairman of the business founded by his parents for 23 years and a major shareholder, before retiring from Air Partner in 2014. Nowadays he prefers to spend his time on the water, where he indulges in yacht racing.

Some of Air Partner’s previous directors are particularly well-connected. Richard Everitt, CBE held the company chairmanship from 2012 until 2017. A solicitor by training, prior to joining Air Partner Everitt was a director of the British Aviation Authority (BAA) and chief executive of National Air Traffic Services (Nats), and then CEO of the Port of London Authority (PLA). Since leaving the PLA, he has continued his career on the board of major transport authorities, having twice been appointed by the Department of Transport as chair of Dover Harbour Board, a two-day per week job with an annual salary of £79,500. He also served as a commissioner of Belfast Harbour.

One figure with friends in high places was the Hon. Rowland John Fromanteel Cobbold, who was an Air Partner director from 1996 to 2004. Cobbold was the son of 1st Baron Cobbold, former Governor of the Bank of England and former Lord Chamberlain, an important officer of the royal household. He was also grandson of Victor Bulwer-Lytton, 2nd Earl of Lytton and governor of Bengal, and younger brother of 2nd Baron Cobbold, who was a crossbench peer.

Lib Dem peer Lord Lee of Trafford held significant shares in Air Partner from at least 2007 until the company was bought by Wheels Up in 2022. Lord Lee served as parliamentary undersecretary for MOD Procurement under Margaret Thatcher, as well as Minister for Tourism. In 2015 the value of his 113,500 shares totalled £446,000. His shares in the company were despite having been Lib Dem party spokesman on defence at the time. Seemingly, having large stakes in a business which benefits from major MOD contracts, whilst simultaneously advocating on defence policy was not deemed a serious conflict of interest. The former stockbroker is now a regular columnist for the Financial Times. Calling himself the “first ISA millionaire”, Lee published a book called “How to Make a Million – Slowly: Guiding Principles From a Lifetime Investing”.

Lord Lee of Trafford

The company’s recent profits have been healthy enough to ensure that those at the top are thoroughly buffered from the current cost of living crisis, as all executive and non-executive directors received a hefty pay rise. Its 2022 Annual Report reveals that CEO Mark Briffa’s pay package totalled £808,000 (£164,000 more than he received in 2021) and outgoing Chief Financial Officer Joanne Estell received £438,000 (compared with £369,000 in 2021), not to mention that Briffa and Estell were awarded a package in spring 2021 of 100% and 75% of their salary in shares. Given the surge in Air Partner’s share price just before the buyout, it’s likely that the net worth of its directors – and investors like Lord Lee – has significantly increased too.

Conclusion

What really is the difference between the people smugglers vilified daily by right-wing rags, and deportation merchants like Air Partner? True, Air Partner helps cast humans away in the opposite direction, often to places of danger rather than potential safety. And true, smugglers’ journeys are generally more consensual, with migrants themselves often hiring their fixers. But for a huge fee, people smugglers and deportation profiteers alike ignore the risks and indignities involved, as human cargo is shunted around in the perverse market of immigration controls.

In October 2022, deportation airline Privilege Style announced it would pull out of the Rwanda deal following strategic campaigning by groups including Freedom from Torture and SOAS Detainee Support. This is an important development and we can learn lessons from the direct action tactics used. Yet campaigns against airlines are continuously being undermined by Air Partner – who, as the Home Office’s deportation fixer, will simply seek others to step in.

And under the flashing blue lights of a police state, news that an airline will merely be deporting refugees to their countries of origin – however dangerous – rather than to a distant African processing base, might be seen as wonderful news. It isn’t. Instead of becoming accustomed to a dystopian reality, let’s be spurred on by the campaign’s success to put an end to this cruel industry in its entirety.

Appendix: Air Partner Offices

Air Partner’s headquarters can be found next to Gatwick Airport, 15 minutes walk from Brook House and Tinsley House detention centres

2 City Place, Air Partner’s HQ

Air Partner’s addresses, according to its most recent annual report, are as follows:

  • UK: 2 City Place, Beehive Ring Road, Gatwick, West Sussex RH6 0PA.
  • France: 89/91 Rue du Faubourg Saint-Honoré, 75008 Paris & 27 Boulevard Saint-Martin, 75003 Paris.
  • Germany: Im Mediapark 5b, 50670 Köln.
  • Italy: Via Valtellina 67, 20159 Milano.
  • Turkey: Halil Rıfatpaşa Mh Yüzer Havuz Sk No.1 Perpa Ticaret Merkezi ABlok Kat.12 No.1773, Istanbul.

With thanks to Abolish Frontex and Deportation Alarm for their insights.

Footnotes

1 Aldrick, Philip. “Worth teaming up with Air Partner”. The Daily Telegraph, October 07, 2004.

2 “Air Partner makes progress in the face of some strong headwinds”. Proactive Investors UK, August 27, 2021.

3 Aldrick, Philip. “Worth teaming up with Air Partner”. The Daily Telegraph, October 07, 2004.

4 Lea, Robert. “Mark Briffa has a new partner in aircraft chartering and isn’t about to fly away”. The Times, April 29, 2022

5 Ibid.

6 “AirPartner predicts rise in demand if Gulf war begins”. Flight International, January 14 2003.

7 “Celebrity status boosts Air Partner”. Yorkshire Post, October 10, 2002.

8 Baker, Martin. “The coy royal pilot”. The Sunday Telegraph, April 11, 2004.

9 Hancock, Ciaran. “Air Partner”. Sunday Times, April 10, 2005.

10 Saker-Clark, Henry. “Repatriation and PPE flights boost Air Partner”. The Herald, May 6, 2020.

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Athens, Greece: Interview on the battle for Strefi Hill https://corporatewatch.org/athens-greece-interview-on-the-battle-for-strefi-hill/ Fri, 07 Oct 2022 19:27:23 +0000 https://corporatewatch.org/?p=11795 In a densely-populated corner of central Athens, a fierce battle is erupting. On the one side: Athens council, its investor friends, and various other hangers-on salivating over a parcel of prime real estate. On the other: residents young and old, students, anarchists, refugees, and artists who see the place as of vital symbolic, political and […]

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In a densely-populated corner of central Athens, a fierce battle is erupting. On the one side: Athens council, its investor friends, and various other hangers-on salivating over a parcel of prime real estate. On the other: residents young and old, students, anarchists, refugees, and artists who see the place as of vital symbolic, political and emotional significance.

The area is Exarchia. Long an epicentre for anarchists and squatters, it is also home to the Polytechnic University, site of the 1973 student uprising against the dictatorship and ensuing massacre.

The current neoliberal government of Kyriakos Mitsotakis took aim at the neighbourhood as soon as it was sworn in a little over three years ago, starting with a wave of squat evictions and mass detention of migrants living in them. Athens council, headed by the Prime Minister’s nephew (there is scarcely anyone in the Mitsotakis dynasty who doesn’t hold power), has since been on a concerted mission to wipe out the last vestiges of self-organisation and resistance that characterises the area.

Central to the council’s redevelopment plans are the construction of a metro station in the square, despite the existence of two functional stations nearby, and the redevelopment of the neighbourhood’s principal green space: Strefi Hill. Both projects are seen as part of a flagrantly political agenda and are strongly opposed by many who live there, resulting in parts of the neighbourhood having been placed under 24-hour occupation by the police.

In the past few days, the campaign to defend the hill has intensified as the council has sought to close it off for works. Growing anti-gentrification demos have been met with police aggression and beatings (including that of a journalist), and arrests.

To shine more light on this important battle, we interviewed people from the Open Assembly for the Defence of Strefi Hill, which has been at the centre of the struggle to protect the land from development. Translation from the original Greek.

 

“Strefi Hill will stay free”

Interview

Can you give a brief description of the place for people who aren’t familiar with it?

Strefi hill is in Exarchia. It’s a free/public space in the centre of Athens and it is one of the few green spaces left in the urban area. It has a basketball court, an open theatre and a kid’s playground, which are all connected with stone paths that lead to the top of the hill from where you can view a large part of the city.

Can you give us a little history of Strefi hill and why it’s so important to people?

Up until the 1920s, the hill belonged to the Strefi family and was used as a quarry. Afterwards, it passed to the Greek state, and in 1930 to the municipality of Athens. Exarchia is an area with a rich history, since it has been the ground for many class and social insurrections and is a place where various self-organised projects meet.

Thus, today the hill is a place for meetings and assemblies of various groups; it’s a green space for anyone who wants to live even moments outside the suffocation of urban spaces; it’s a place for cultural events; it’s a place where homeless people find shelter; and it’s also the organisational ground for actions against the gentrification of the neighbourhood.

Tree climbing on the hill

What is the ecological significance of the project?

The company Prodea will construct anti-ecological ‘flood protection’ work similar to those built on national roads. The geotechnical study involves geogrids and gabions, which would result in the deforestation of all trees and bushes. This will not only block the hill off to people for a long time, but will destroy nests belonging to turtles and other animals, and block their access to food. Also, the project includes intense lighting in many parts of the hill. In practice, this means that many bird species that live on the hill or pass and stay will be kicked out. So we are talking about a project that will totally upset the ecological balance of the hill.

Can you give us some wider context of the political and environmental situation over there?

We are living through a period where besides Strefi hill, private interests in collaboration with the state and municipality are trying to take over most of the free green public spaces of Athens, to make them tourist attractions and totally gentrify the area.

Another important aim of the state is the de-radicalisation and de-politicisation of the areas of the city centre, and especially Exarchia. Besides their attempt to privatise the hill, they are trying to build an underground metro station in the only square of Exarchia. All of this, of course, comes hand in hand with severe repression. There are many cop units permanently stationed around the square and other cops on patrol – with all that entails (threats, aggressive behaviours, beatings, arrests).

Tell us a bit about the struggle so far?

The Open Assembly for the Defence of Strefi Hill has been going on for about one year and a half now, and from the very beginning it has met on a weekly basis. The actions vary. In terms of activities, we often do film-screening nights, collective cleaning and activities for children. To put pressure on the companies, we have done a non-publicised demonstration outside Unison offices and two public actions outside Prodea offices, as well as demonstrations outside the city hall when inside they were discussing the gentrification of the hill.

We have organised marches in Exarchia against gentrification in general, targeting some Airbnb buildings on our way. And lastly, our assembly participates in the coordination of groups that defend Exarchia which is a network of many groups and individuals, in which we organise actions for the general defence of the area against gentrification and police presence.

Who owns the hill?

As mentioned, the hill has belonged to the city council since 1930 and it is one of the few free parks in the centre of Athens. For many years now the municipal authorities have systematically ignored the needs of the hill (cleaning, maintenance, flood protection, support of the slopes, accessibility, watering, fire protection, lighting and gardening). In January 2021, the council conceded the hill to a real estate company, Prodea Investments.

So while the state continues to collect council taxes as normal, this company arrives like some form of ‘divine intervention’ to get rid of the council’s responsibilities. In general, Greece is going through a period where state and capital are trying to privatise everything, from electricity and water, to parks and forest areas. In the case of parks in urban areas, this is attempted initially through concessionary companies hired by the council in order to make gentrification projects for the profits of the powerful few.

What do you think the motives are behind the development?

The motives behind the project vary. The developers of the project, Prodea, simply aim to make profit, since they have in their possession a lot of properties in Exarchia and in the centre more generally. Through their work on the hill, they serve the tourist market of the area.

The council will place CCTV cameras and security boxes to surveil the space once the project is completed. So the main aim of the council is to get rid of all resistance from the hill and bring in private companies.

What work has been done so far?

[Editor’s note: the situation has intensified in the last few days, with attempts to close off the hill for work, and demonstrations followed by police violence].

Practically, until now the only thing that has happened is the license contracts between the council and Prodea real estate company. Companies have tried numerous times to make land surveys on the hill but were blocked by local people. In August 2022, the council decided to send police (many units of riot cops, motorbike cops and anti-crime cops) along with the companies to the hill, but people resisted and blocked many of the works, which were mainly land surveys. So until today, the hill hasn’t been altered, no machinery has ever come and the resistance goes on.

What companies have you identified as being involved, and what role do they play?

The contractor is Prodea Investments. The company owns many properties in Exarchia and beyond, and one is the building that houses the Ministry of Culture, which was sold to the company by the state. It has huge potential for profit from the gentrification of the hill, but also from the gentrification of the whole area.

A part of the project will be carried out by Unison Facilities Services. Under the pretext of maintenance and regeneration, Unison will concrete over all the paths, and will cut trees and put up cameras, fences and security boxes for the control of the entrance. They may be given the ex-Vyzantino building (an abandoned building on the hill), for the cleaning and surveillance services of the hill, in order to freely exploit the workers and control the areas around their site. Unison is contracted by the council to manage all the green parks of the city, including Filopappou hill, Lycabettus hill and Tourkovounia, Plato’s Academy, Patision & Kiprou park, Goudi park, Protomagias square, Kipseli square, Victoria square, America square, Attiki square, Agios Panteleimonas square, Villa Drakopoulou, Fix Patision park, and the pedestrian precincts of Agias Zonis and Fokionos Negri.

Unison receives red-carpet treatment from the Athens municipality. Despite not being one of the biggest firms in the construction business, the project was ‘given’ to Unison for € 35.445.994, in a Best Value Tendering travesty.

What do you want to see instead of this development?

We believe that the hill, besides some problems that occur when it rains which can cause flooding or erosion is in a pretty good condition. We want a flood protection system but not the way it’s planned. We want it with plant-based landscape interventions for the support of the slopes and prevent erosion on the hill, something that would ensure the balance of the ecosystem, of fauna and flora. In the meantime, we do actions that bring more life to the hill like tree-planting, cleaning, watering. etc.

How can people support the fight?

For sure, participating in the assembly is important, because more people means bigger resistance. At the same time, making public our struggle and denouncing publicly the companies that are involved is very important in order for them to be hit financially, since what concerns them is profit.

Find out more:

Open Assembly for the Defence of Strefi Hill

Website: www.lofosstrefi.noblogs.org

Twitter: www.twitter.com/LofosStrefi

Demo against Unison. “Unison out of Strefi Hill; free spaces for all”

Banner against Prodea

Fake graffiti hoardings, Exarchia Square, site of the planned metro station

“Strefi Hill will stay free, public and wild”

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