Specific instance of NBIM
In October 2012 the Norwegian, Netherlands, and Korean NCPs received a request for review from a consortium of NGOs (Lok Shakti Abhiyan (India), Korean Trans National Corporation Watch (South Korea), Fair Green Global Alliance (Netherlands), and ForUM (Norway), alleging that Pohang Iron and Steel Enterprise (POSCO), and its joint venture POSCO India Private Limited had breached the human rights provisions of the Guidelines. The allegations also concerned two of POSCO's investors, the Dutch Pension Fund ABP, and its pension administrator APG, and the Norwegian Bank Investment Management (NBIM) of the government pension fund Global.
More specifically, the NGOs alleged that POSCO failed to:
- seek to prevent or mitigate human rights impacts;
- to conduct comprehensive human rights due diligence; and
- to carry out environmental due diligence in its project to set up a steel plant in the Jagastinghpur District in Odisha, India, which is carried out by thewholly owned subsidiary POSCO India Private Limited.
The notifying parties allege that the financial institutions did not take all the appropriate steps to prevent or mitigate POSCO’s negative impacts on human rights and environmental rights which are directly linked to them through their financial relationship with POSCO.
The NCPs agreed that each NCP should handle the notification against the enterprise registered in their respective country. Consequently the Norwegian NCP assessed the alleged breach by NBIM, the Dutch NCP assessed the alleged breach by ABP and APG, and the Korean NCP assessed the alleged breach by POSCO.
After the investigation, both the OECD’s Investment Committee and the Working Party on Responsible Business Conduct (WPRBC) have addressed the questions raised in relation to the case. They confirmed the Norwegian NCP’s position that the Guidelines are also applicable to minority shareholders and for all sectors of the economy, including the financial sector.