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Wal-Mart Dumped from one of the World's Largest Pension Funds

April, 04 2007 Share

The Norwegian Government's pension fund, with $285 billion in holdings, is dropping Wal-Mart--the world's largest retailer--from its fund due to the use of child labor and systematic sweatshop abuses in its huge global supply chain.

In its 2006 Annual Report, released on March 20, 2007, the Council on Ethics for the Government Pension Fund-Global reached the following conclusion:

"There is no doubt...that Wal-Mart purchases a number of products that are manufactured under unacceptable conditions.  There are numerous reports of child labor, serious violations of working hour regulations, wages below the local minimum, health-hazardous working conditions, unreasonable punishment, prohibition of unionization and extensive use of a production system that fosters working conditions bordering on forced labor, and employees being locked into production premises, etc. in Wal-Mart's supply chain.  All the above examples represent violations of internationally recognized standards for labor rights and human rights."  (page 27)

"The Petroleum Fund's Council on Ethics considers that there is an unacceptable risk that the fund, through its investments in Wal-Mart Stores Inc., and Wal-Mart de Mexico SA, may be complicit in serious or systematic violations of human rights.

"The Council recommends that Wal-Mart Stores Inc.  and Wal-Mart de Mexico SA be excluded from the Petroleum Fund's portfolio."  (page 3)

On the U.S. front, the fund found Wal-Mart guilty of "discrimination of female employees," "active obstruction of employees' right to unionize," "violations dealing with the employment of minors," "mandatory overtime without compensation" and the "use of illegal labor."

In the section of the report dealing with Wal-Mart's abusive offshore sweatshop practices, the Norwegian Government's Council on Ethics largely relied upon the National Labor Committee's research in Honduras, El Salvador, Nicaragua, Bangladesh and China.  The NLC's research was corroborated by other independent human and worker rights organizations.

Points which emerge in the Fund's report:

* "Wal-Mart imports products from 70 countries around the world."

* "In 2003, Wal-Mart imported goods valuing more than $15 billion from China and is the world's largest importer from China."

* In 2004, Wal-Mart had 5,300 direct suppliers, but overall depends upon "our 68,000 suppliers worldwide."

* Wal-Mart's annual sales exceed the Gross Domestic Product of 161 countries in the world.

Access Norway's
"Annual Report 2006 / Council on Ethics for the Government Pension Fund-Global"

Read the May 7, 2007 New York Times article about the pension fund.