Report on Human Rights-Related Financial Risks
A growing number of companies such as Baker Hughes have divested their operations in Burma due to concerns about the repressive government of Burma’s ongoing human rights abuses;
Unocal and other companies face pending legal claims in U.S. courts for their alleged complicity in human rights abuses in Burma, including benefiting from the use of forced labor;
In the summer of 2003, Congress overwhelmingly passed and President George W. Bush signed into law new restrictions banning imports of goods produced in Burma to the U.S.;
Secretary of State Colin Powell wrote in a column in The Wall Street Journal, calling the ruling government of Burma “thugs” and wrote, “We also should further limit commerce with Burma that enriches the junta’s generals.”;
BJ Services Company provides pipeline service operations in Burma and maintains a district office in Rangoon, Burma; and
BJ Services Company also does business in other countries with controversial human rights records, including Angola, Cameroon, and Nigeria;
THEREFORE BE IT RESOLVED, that shareholders request that the Board of Directors prepare a report to shareholders, at reasonable cost and omitting proprietary information, evaluating financial risks posed by company operations in countries with a pattern of ongoing and systematic violation of human rights (including Burma) and the financial impact to the company of divesting from these countries.
Supporting StatementBurma (also called Myanmar) is ruled by a military government that seized power in 1988. The government voided 1990 elections, which were won by the National League for Democracy led by Nobel Peace Prize Laureate Aung San Suu Kyi. The government held Suu Kyi under house arrest from 1989 to 1995 and again for 18 months in 2001 and 2002. A year after releasing her, the military government provoked international criticism in May 2003 by attacking and killing a number of Suu Kyi’s supporters and reimprisoning her.
In addition to the new U.S. trade sanctions, the European Union has imposed new trade sanctions and Japan is freezing the considerable foreign aid it grants to Burma. The new U.S. trade sanctions codify an existing U.S. policy to oppose World Bank loans or international technical assistance to Myanmar. In 1997, the U.S. banned U.S. companies from making new investment in Burma.
Given this context, we believe that B.J. Services’ operations in Burma face significant new financial risks and could damage our company’s reputation. A report outlining the company’s assessment of the financial risks of continued operations in Burma and other countries with systematic patterns of violating human rights would help shareholders better assess how human rights controversies may affect the company’s future growth and how the Board and management are managing risks associated with this issue.