TORONTO – Canadian investment giant Mackenzie Investments announced today that it has ceased investing in Asia Pulp and Paper’s (APP) pulp operations linked to illegal logging and the clearance of endangered Sumatran tiger habitat.
“Mackenzie has shown commitment to ethical and environmentally responsible investing,” said Shane Moffatt, forest campaigner with Greenpeace Canada. “Until APP stops destroying rainforests and critically endangered Sumatran tiger habitat, it will keep shedding customers and remain a pariah in the investor community.”
Mackenzie held shares in the APP subsidiary PT Indah Kiat Pulp & Paper Corp (INKP.JK) worth approximately US $24 million. In a brief statement posted online, Mackenzie stated: “PT Indah Kiat Pulp & Paper Corp. TBK is no longer held by Mackenzie. Based on a full review of the holding and taking all aspects of the investment into consideration, the portfolio manager determined that the sale of Indah Kiat was in the best interest of the Funds.”
Mackenzie’s announcement comes on the back of another large international investor, Norway’s Skagen funds, selling its shares in Inda Kiat based on a “review of investment philosophy, ethical guidelines and our aim of providing our unit holders with the best possible risk adjusted return.” Indah Kiat’s share price fell 25 per cent last year alone.
Earlier this year, Greenpeace released a report following a yearlong investigation which found that the Indah Kiat mill is systematically violating Indonesia’s laws protecting the internationally protected tree species ramin. The report also revealed that the mill is supplied with rainforest timber from areas mapped as habitat of the Sumatran tiger, whose numbers are down to an estimated 400 in the wild. The mill, one of the largest in the world, ships pulp and paper products to Europe, Asia and North America.
Since Greenpeace exposed APP’s illegal timber scandal earlier this year, a host of major company including Danone, Xerox and Mondi have all cancelled their contracts with APP.
APP, which operates five pulp mills in B.C., Saskatchewan and Nova Scotia under the Paper Excellence banner, continues to lose customers at an accelerating rate due to its destructive track record and increasingly toxic reputation.