Thread by @WilliamYang120

Many of the world’s largest asset managers and state pension funds are passively investing in companies that have allegedly engaged in the repression of #Uyghur Muslims in #China, according to a new report. theguardian.com/world/2022/nov…

The report found that three major stock indexes provided by MSCI include at least 13 companies that have allegedly used forced labour or been involved in the construction of the surveillance state in China’s Xinjiang region.

“If the average Briton or American realised that hundreds of millions of pounds or billions of pounds were being invested in Chinese technology firms with close ties to the state, they would be outraged,” said Johnny Patterson, an author of the report.

The report includes a list of major asset managers, including BlackRock, HSBC and Deutsche Bank among others, exposed to index funds that include companies accused of engaging in labour transfers and the construction of repressive infrastructure in the region.

It found public pension funds across the UK, Canada and the US and funds in New Zealand and Japan exposed by the investments.

Of the companies listed in the report engaged in the alleged use of forced labour or construction of camps and surveillance infrastructure, four are on the MSCI All-Country World Index ex-US, 12 are on the MSCI China Index and 13 are on the MSCI Emerging Markets Index.

MSCI told the Guardian the only filters for inclusion in their indexes are accessibility and investability. “If an international investor is able to access the stock market and invest in the companies in the market, ...

... then the market and those companies are eligible for inclusion in our market indexes,” the company said.

“So many people’s pensions, retirement funds and savings are invested passively because, as average consumers, we don’t have time to investigate each and every investment,” said @LauraTMurphy.

“Investing in companies operating in the Uyghur region is a serious ethical risk, but it’s also a financial risk, since these companies have been targeted by government sanctions and international advocacy campaigns,” said Murphy.

The report’s recommendations to governments include creating a list of banned entities, banning investments in companies complicit in engaging state-imposed forced labour and passing legislation banning the import of goods with ties to forced labour.