Archived press release

Shareholders protest at RTZ AGM

7 May 1996

The RTZ Corporation plc AGM starts at 11am in the QEII Centre, Broad Sanctuary (off Parliament Square) SW1.

Friends of the Earth activists will attend the RTZ AGM on Wednesday, May 8th to question directors over the company's proposed mineral sands mining project in Madagascar. There are indications that large financial institutions who invest in RTZ are also using their shareholder status to raise concern over the potential impacts of this project [1].

Indeed, several large institutional shareholders in RTZ have already raised their concern directly with the company over the project [3]. In a recent letter to Friends of the Earth, General Accident said that investors'concerns may not always be diametrically opposed to those of well-meaning pressure groups', whilst Allied Dunbar, a significant investor in RTZ, stated in a letter to Friends of the Earth that they recognise that, as institutional investors, we are in a position to influence the activities of the companies in which we invest...'

If the project goes ahead, at least two thirds of the remaining unique littoral forest along the south-eastern coast of Madagascar could be destroyed hastening the extinction of many endemic species of animals and plants.The project would also threaten traditional livelihoods such as fishing by drastically altering the hydrology of the coastal area.

RTZ says that no final decision has yet been made on the proposed project, which is expected to last for forty years, although they are currently negotiating further impact studies with the Malagasy Government. Friends of the Earth believes that shareholders of RTZ, which include many local authorities and insurance companies, would like to see RTZ take more responsibility for the social and environmental impacts that could be brought about by this proposed project [2].

Sarah Tyack, Forest Campaigner at Friends of the Earth said:

People are becoming increasingly aware of the environmental and social impacts of the City's money making machine and want the big institutional investors to factor these concerns into their business decisions. A few companies already realise that sustainable profits rely on sustainable development and we hope they will use their financial muscle to block this project'.

Friends of the Earth believes that more sustainable development alternatives such as eco-tourism can be found for Madagsacar and is calling for the cancellation of the country's crippling debts which lead to development projects funding huge interest repayments instead of helping the poor.

ENDS

NOTES TO EDITORS:

[1] RTZ's wholly owned Canadian subsidiary, QIT Fer et Titane, is developing plans to mine deposits containing ilmenite which is a major source of titanium dioxide (TiO2). Titanium dioxide is used as a whitening agent in numerous products such as paint.

The littoral forests under threat from the proposed mine are unique,representing a transition between rainforest and spiny forest environments.Madagascar is famous for its astounding diversity of unique species of plants and animals including 34 endemic species of chameleon and 30 endemic species of lemur. Approximately 45% of all known native species of Madagascar's vertebrates occur within this region. 29 species of plant are endemic to the mine area and 16 face possible extinction if the project proceeds.

[2] Friends of the Earth campaigners will be seeking answers to questions such as:

1. What percentage of the profits from the Madagascar mineral sands project will go to the Government of that country and how much will the mine contribute to economic development in the country given its debt service obligations.

2. Could the company please explain what long term benefit will accrue to Madagascar after the project terminates in approximately 40 years time.

3. How many local people will the mine employ and for how long?

4. Why did the South African Government recently stop Richards Bay Minerals from proceeding with a second mineral sands mining project in St Luce which would have had ecological impacts comparable to the mineral sands mining project currently proposed in Madagascar?

5. How does the company expect to compensate for the loss of unique biodiversity and the possible extinction of some endemic species that could result from the proposed mineral sands mining project in Madagascar?

6. What steps has the company taken to consult the local communities on resettlement and compensation programmes resulting from the proposed mineral sands mining project in Madagascar?

7. What benefits does the company envisage that the mining project in Madagascar will bring to the local communities?

[3] Institutions who have raised concern with RTZ include General Accident, Friends Provident, Allied Dunbar, The Equitable Life Assurance Society, Legal and General and Norwich Union.

If you're a journalist looking for press information please contact the Friends of the Earth media team on 020 7566 1649.

Published by Friends of the Earth Trust