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​AP funds targeted toy manufacturers over ’dangerous’ factories

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Sweden’s buffer funds last year engaged with companies over dangerous working conditions, low wages and the extraction of oil against the wish of the local population, according the Ethical Council’s annual report.

The Ethical Council, which coordinates the engagement efforts of the four buffer funds worth a total of SEK1.1trn (€122bn), said extractive industries continued to pose challenges and noted that it was monitoring the activities of oil company Total.

The funds warned that Total, currently exploring potential oil fields off the cost of Western Sahara, could be in breach of international law if it began extracting oil against the wishes of the local population.

Norway’s KLP previously divested from the French firm over its activities in Western Sahara.

Other companies with which the funds engaged included toy manufacturer Mattel and sportswear company Nike, both over supply chain concerns.

The Council noted reports of dangerous workplaces, official harassment and unlawful terms of employment at manufacturing plants in China.

Discussing Mattel’s mention in many of these reports on working conditions at suppliers, it said: “The Ethical Council had long tried to establish a constructive dialogue with the company about these issues but had little luck.

“In 2014, however, Mattel expressed willingness to discuss their relationships with suppliers and the working conditions at their own plants.”

Having been mentioned in the past, Nike was highlighted for tackling issues of unpaid overtime and poor working conditions. The annual report noted that a number of workers who had previously been sacked by the company’s suppliers for protesting working conditions had “finally” rehired and that Nike was working with an initiative in Cambodia to improve conditions.

The Ethical Council also ceased engagement with three firms, recommending that the buffer funds exclude the company.

Barrick Gold was marked for exclusion over the environmental impact of its mining, Motorola Solutions for its involvement in monitoring solutions in the occupied parts of the West Bank and Agrium, a Canadian agricultural retailer previously excluded by KLP, was barred for its use of phosphates sourced from Western Sahara. 

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