Switzerland-based Glencore Plc finds itself embroiled in a scandal of significant proportions, drawing attention for all the wrong reasons. Following extensive investigations by authorities in Brazil, the United Kingdom, and the United States, two of Glencore’s subsidiaries confessed on May 24 to multiple charges, including market manipulation and bribery, particularly in connection with the company’s oil operations across Africa and South America.
The repercussions for Glencore’s misconduct in the United States alone, in violation of the Foreign Corrupt Practices Act (FCPA) and for manipulating commodity prices, are staggering, amounting to approximately $1.2 billion in penalties.
According to investigations, Glencore’s illicit activities involved doling out over $100 million in bribes to officials in various countries, including Brazil, Cameroon, Côte d’Ivoire, Equatorial Guinea, Nigeria, South Sudan, and Venezuela, spanning from 2007 to 2018.
U.S. Attorney Damian Williams for the Southern District of New York described the extent of Glencore’s criminal bribery scheme as “staggering,” emphasizing the company’s pursuit of profit through illegal means, with the complicity of its top executives.
The African Energy Chamber condemns Glencore’s actions as illegal, immoral, and entirely unacceptable. The Chamber stresses that Glencore’s conduct is not reflective of the standard business practices within the oil and gas industry and underscores that it has neither sought nor received any financial support from Glencore.
The Chamber advocates for thorough investigations into Glencore’s dealings in African countries and demands accountability for African officials who accepted bribes. Furthermore, the Chamber calls for full disclosure of Glencore’s corrupt business practices, considering the company’s membership in the Extractive Industries Transparency Initiative (EITI). Given Glencore’s history of corruption, the Chamber suggests suspending Glencore’s status as an EITI supporting company.
The Chamber finds it ironic that Glencore remains a member of EITI, an organization committed to transparency and accountability, despite engaging in extensive corruption. The Chamber calls attention to this double standard and urges EITI to take appropriate actions.
In light of Glencore’s penalties, the Chamber urges the U.S. government to allocate the $1.2 billion fine towards initiatives that empower Africans, who are the most affected by Glencore’s malfeasance. Specifically, the Chamber recommends directing funds to organizations such as Power Africa and Prosper Africa, which aim to address energy poverty and promote economic development in sub-Saharan Africa.
Additionally, the Chamber suggests allocating a portion of the penalty payments to the African Energy Bank, a proposed institution aimed at facilitating investments in renewable energy projects across Africa, in alignment with international climate goals.
As Glencore’s actions cast a shadow over Africa’s oil and gas sector, the Chamber emphasizes the need for integrity and adherence to the rule of law in business operations. The Chamber expresses disappointment in Glencore’s conduct and underscores its commitment to working with ethical energy companies to build a brighter future for Africa.
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