In financing the infrastructure for soccer's World Cup in Qatar, well-known European banks and pension funds paid too little attention to human rights, according to NGO Fair Finance International.
Since Qatar was nominated to host the World Cup, there has been a steady stream of reports of migrant workers building the tournament's facilities or maintaining the luxury hotels and shopping malls, being exploited.
Among the numerous accusations are exploitative recruitment practices, irregularly paid wages, restricted freedom of movement, or deadly conditions with twelve-hour, or more, workdays in extreme heat.
Sweeping Accusations
These accusations are directly related to a labor market far from the standards we are used to in Europe. Fair Finance International (FFI) published a report, saying investors should also be held accountable.
According to the non-governmental organization's (NGO) investigations, European banks and pension funds have co-financed investments in Qatari infrastructure for the World Cup or indirectly favored them by buying Qatari bonds.
Construction and Hospitality Vulnerable
Financial institutions provided loans and acquisitions totaling $85.7 billion to selected construction and hospitality companies since the beginning of 2019, according to the report. Nearly half of the total financing identified is provided by European European banks, pension funds, and insurance companies. The two sectors financed were found to have a high risk of human rights abuses.
According to the data, 30 German, 5 Norwegian, and 16 Swedish financial institutions were identified as having invested in shares or bonds of the selected companies in the hospitality and construction sectors, or government bonds issued by the Qatari government.
Call For Regulations
The largest European investor, Allianz, poured more than $4 billion poured into companies in the construction or hospitality sectors and Qatari government bonds. Norway's state pension fund has invested more than $3.3 billion in the companies.
The FFI report includes 16 companies that have abetted human rights abuses in Qatar. None of these companies could be described as complying with human rights as defined by the United Nations Guiding Principles on Business and Human Rights, it said.
In FFI's view, the financial sector must be further reined in as a result of this situation, and in the EU, the financial sector should be integrated into the proposed new EU legislation on corporate due diligence.
