US debate sponsor invests in Cos doing business in Sudan
June 6, 2007 (WASHINGTON) — CNN’s coverage of two presidential debates this week, one of which elicited strong condemnations of the violence in Sudan, was co-sponsored by a Boston-based mutual fund firm that has invested in companies that do business in the African country.
The firm, Fidelity Investments, has been a target of human rights groups because it has invested in PetroChina (0857.HK), a Chinese company that has significant ties to Sudan’s government-owned oil industry.
Fidelity Investments, also known as Fidelity Management and Research Corp., last month reported selling more than 4 million shares of PetroChina stock traded on the New York Stock exchange, a 90% reduction in those holdings. But the firm still owns millions of PetroChina shares traded on the Hong Kong exchange.
Meanwhile, candidates such as Democrats Barack Obama and John Edwards and Republicans Sam Brownback and Rudy Giuliani have taken steps to divest their personal finances of Sudan-related holdings. And Democrats, in their debate Sunday, called for diplomatic and military measures to end what the Bush administration has called a genocide in Sudan’s Darfur region.
The Sudanese government has been accused of arming janjaweed militia in a four-year war that has killed more than 200,000 people and displaced more than 2.5 million, prompting an international campaign to pressure certain companies to leave Sudan.
In Sunday’s debate, New Mexico Gov. Bill Richardson, a Democrat, said he would request more United Nations peacekeepers for Darfur, impose stronger economic sanctions and put pressure on China, which has some of the strongest economic ties with the Sudanese government. Delaware Sen. Joe Biden, also a Democrat, called for a no-fly zone over Sudan and a commitment of 2,500 NATO troops into Darfur.
Allyn Brooks-LaSure, a spokesman for the Save Darfur Coalition, said the debate and Fidelity’s sponsorship was a moment of “high irony.”
“The Save Darfur Coalition thinks it was great that there was such a serious, meaningful discussion about Darfur on Fidelity’s dime,” he said.
Eric Cohen, chairman of Fidelity Out of Sudan and a coalition partner, called on candidates to divest their personal finances of Sudan-related investments, to refuse political contributions from firms that have such holdings and to decline invitations to events sponsored by such firms.
Fidelity has said the firm leaves investing decisions to the managers of its various investment funds and that the sale of PetroChina stock was not based on a shift in company policy.
“Fidelity does not tell its fund managers how or when to buy or sell any given stock,” spokesman Vincent Loporchio said Wednesday. “Each fund manager makes that decision based on their individual assessment of the stock’s value.”
CNN spokesman Sal Petruzzi said Fidelity and fellow co-sponsor AARP, the advocacy group for the elderly, did not underwrite the costs of the debate. “Essentially, they are not sponsors of the actual debates but rather they are sponsors of our coverage,” Petruzzi said in an email message.
Last month CNN refused to run a Save Darfur Coalition ad calling on Fidelity to divest itself of PetroChina stock. At the time, Fidelity warned that its investment portfolio was about to change, making Save Darfur’s claims out of date. Days later, Fidelity filed documents with the Securities and Exchange Commission detailing its sale of the U.S.-traded shares in the Chinese oil company.
“The information that formed the justification for singling out Fidelity in the ad is no longer current nor accurate, therefore CNN elected not to run the ad,” Petruzzi said.
Activists say Fidelity should get rid of its remaining PetroChina stock, including the shares traded on the Hong Kong exchange. Loporchio said those PetroChina holdings amount to 3.8% of Fidelity’s share of foreign-traded stock. He said activists are counting PetroChina shares owned by Fidelity International, a separate entity.
(AP)