ABB Ltd., Siemens AG and Alcatel rejected demands by the CalPERS board that the companies cease their operations in the Sudan.
In December, the board of the $206.1 billion California Public Employees' Retirement System, Sacramento, approved 9-2 a motion by state Treasurer Phil Angelides to pressure the companies. The Sudanese government has been charged with conducting genocide in the Darfur region, leading to pressure on some public funds and university endowments to sell their holdings or take a stand on portfolio companies doing business in the country.
Executives of ABB, Siemens and Alcatel each responded that ceasing their Sudanese operations would hurt the Sudanese people. Instead, they favor engaging in "constructive dialogue" with the government. Building a country's infrastructure boosts the economy and ultimately paves the way toward democracy, wrote Serge Tchuruk, president director general of Alcatel, in a Jan. 10 letter to Anne Stausboll, CalPERS' interim CIO. "If the country was left completely isolated from the communications network of the planet, no one would even know about the tragedy in the Darfur," Mr. Tchuruk wrote.
Gary Steel, executive vice president of ABB and head of human resources, wrote Ms. Stausboll that "we firmly believe that ABB is a force for good in Sudan." He added that many others, including non-governmental organizations, government officials, diplomats, have urged ABB to remain in the Sudan. "Their advice to us has been unanimous: stay in Sudan to help the country's development of its economic and social infrastructure, support the coalition government in its efforts to return the country to peace and prosperity. To cease business activities, they tell us, would be to undermine the positive steps that have been taken over the past year," he wrote.
The resolution also asked Royal Dutch Shell PLC to disclose whether the company had made any sales to the Sudanese government or military through its Shell-owned service stations in the Sudan. Jeroen van der Veer, chief executive of Royal Dutch Shell, wrote Ms. Stausboll that Shell had not made any sales to the Sudanese government in 2005 through its service stations, but a tiny amount of sales were made directly to the government of Sudan.