Norges Bank cuts ties with traditional medicine firm over its use of endangered species
Norges Bank has divested from a major traditional Chinese medicine (TCM) company in the wake of EIA’s major exposé Investing in Extinction, which found the body parts of threatened leopards and pangolins being used as ingredients in at least 88 products.
The bank cited an ‘unacceptable risk’ of Tianjin Pharmaceutical Da Re Tang Group Corp Ltd contributing to severe environmental damage.
This exclusion was based on a recommendation by Norway’s Council of Ethics (CoE), which assesses the bank’s investments against guidelines on ethical investment adopted by the Ministry of Finance of Norway.
The CoE found there is a risk that the company, in producing TCM products containing leopard bones, pangolin scales and musk (from musk deer), is contributing to irreversible and severe environmental damage.
In assessing the risk posed by the company’s products, the CoE focused on the categorisation of the species concerned as ‘threatened’ by the International Union for the Conservation of Nature (IUCN) and their listing on Appendix I of the Convention on International Trade in Endangered Species of Wild Fauna and Flora (CITES).
Both are key sources of information which investors should be utilising to assess the risk to biodiversity from the companies in which they are investing.
The CoE also focused on widely available information about illegal trade of these species and found that the non-disclosure of information by Tianjin Pharmaceutical about the traceability or origin of the animal parts in question constitute an unacceptable risk that they may originate from illegal sources.
Among other credible sources of information, the CoE has relied on reports by EIA, including Investing in Extinction which was released last October and highlighted the role of investments by major financial sector entities in three TCM conglomerates using leopard and pangolin parts in their products.
EIA welcomes this action by Norges Bank, noting that it also made similar decisions with respect to five other TCM companies using threatened species in 2021. In these instances, the bank has displayed a proactive approach; its assessment of information and threats and its transparency of process set benchmarks for other big investors to follow if they are serious about halting biodiversity loss.
We urge other financial sector entities, particularly those invested in the companies named in our report, to follow suit at the soonest opportunity.
