Pressure is mounting on institutions associated with TotalEnergies’ controversial oil development project in Uganda. On Tuesday, February 7, the US NGO Inclusive Development International (IDI) and 10 Ugandan and Tanzanian organizations – whose names have not been disclosed for fear of reprisals – announced that they had filed a complaint with the OECD. It accuses insurance broker Marsh of violating the guidelines governing the actions of multinational corporations with regard to respect for human rights and the environment in particular.
Without the support of insurance and reinsurance companies, the construction of the East African Crude Oil Pipeline (EACOP), which will extend over more than 1,400 kilometers through Uganda and Tanzania to allow oil extracted near Lake Albert to be exported across the Indian Ocean, could not proceed, the plaintiffs argued.
“The role of an insurance broker is often invisible, allowing it to avoid facing up to its responsibilities. Marsh’s role, however, deserves close scrutiny because, despite widespread opposition and overwhelming evidence that the project will be a disaster for Ugandans and the planet, it is allowing the EACOP project to go ahead,” said Coleen Scott, on behalf of INI, in a press release. Marsh is part of the global Marsh McLennan Group, which employs 85,000 people and has an annual revenue of $20 billion.
The complaint was received by the OECD’s office at the US State Department in Washington. It will first have three months to rule on the admissibility of the complaint, and then, if applicable, it will need to initiate mediation between the parties in order to reach a possible agreement. As the OECD guidelines are voluntary, the initiative cannot lead to a judicial decision, but for large companies anxious to show their commitment to sustainable development, it casts an unfortunate shadow over their reputation. This is a first for the insurance brokerage industry.
Meanwhile, several arrests have already been made against oil companies. In 2013, the World Wildlife Fund (WWF) made referrals to the OECD concerning the risks posed by British company Soco International’s exploration projects in the Virunga National Park, in the Democratic Republic of Congo (DRC). TotalEnergies also has an exploration license in the park.
Serious damages
In Marsh’s case, the complaint filed by the coalition of NGOs alleges that by agreeing to obtain insurance coverage for EACOP, the insurance broker is contributing to the serious damages the coalition believes the project has already caused or is expected to cause. Listed among them are the “inappropriate land acquisition processes characterized by a lack of prompt and adequate [community] compensation,” “harassment, intimidation and arrest of farmers, NGO members and critical journalists” and “threats to natural resources that people depend on for their livelihoods, including the risk of oil spills affecting freshwater resources, or increased CO2 emissions that will bring the world closer to a climate catastrophe.” The plaintiffs request that Marsh bring “its operations back into compliance with OECD guidelines by withdrawing from its role as a broker” for TotalEnergies.
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Lobbying the OECD is the latest among a string of initiatives by civil society organizations in Africa and in industrialized countries to try to block TotalEnergies’ fossil fuel project in Uganda. “The complaint filed today against Marsh is an important step in the international mobilization against Total’s EACOP project. Insurers like Marsh have a clear responsibility in enabling such climate-changing projects. They cannot turn a blind eye and ignore the overwhelming evidence of human rights violations and the risk of irreversible damage to the environment,” said Juliette Renaud, campaign manager at NGO Les Amis de la Terre France (Friends of the Earth – France). The organization has, for its part, initiated legal proceedings for “non-compliance with French law regarding the duty of care.” The verdict is due to be handed down by the Court of Paris on February 28.
