Dow Jones Newswires reports on a new investor research product that will identify publicly-traded companies doing business with terrorist nations. The purpose of the product is to identify investment risk that has previously not been readily discernible. Unsurprisingly, Talisman Energy is one of only two such publicly-trade companies to be highlighted in the Dow Jones report (attached below). The new investor research product, from the venerable Investor Responsibility Research Center and the Conflict Securities Advisory Group, will be officially introduced later this month. But even now we can see that Talisman’s Sudan connection will be “red-flagged” for institutional investors with many tens of billions of dollars under management. “Caveat emptor” will have a whole new meaning.
Eric Reeves [April 11, 2002]
Northampton, MA 01063
Investors have long needed a better means of assessing the kinds of risk represented by investments in companies doing business with terrorist-sponsoring nations like Sudan. Talisman’s brutal complicity with Khartoum now appears destined to be appropriately highlighted for institutional portfolio managers. Talisman’s partnership with Khartoum’s National Islamic Front will be seen for what it is: support for a regime that both sponsors international terrorism and is conducting its own savage campaign of terror against the people of southern Sudan and other marginalized areas.
To be sure, Talisman has already had a belly-full of bad publicity. But this new highlighting will be even more consequential in the world of investors. Portfolio managers may, for example, have mandates not to own shares of companies that are highlighted by this new research product. Managers will also be aware that increased divestment pressure will be felt across the board among those purchasing this new investment research product. Month after month, the research product would put Talisman’s name before institutional managers in the most unfavorable light. And Talisman management will be unable to “spin” this away with disingenuous blather about Sudan’s terrible realities. The truth will out, and it will stay out, and it will be dramatically present within the world of institutional investing.
The fact that Talisman is one of only two companies highlighted by the first high-profile press report on this new investor research product should allow us to gauge just how severely they will be criticized by the Investor Responsibility Research Center and the Conflict Securities Advisory Group. Relentless, ugly, share-price-destroying prominence seems guaranteed.
“New Product To Name Companies At Risk From Operations In Terrorist Nations” — Wed Apr 10, 4:11 PM ET
DOW JONES NEWSWIRES
By Chad Bray
NEW YORK (Dow Jones)–A new investor research product hopes to identify publicly-traded companies that are potentially at risk because they do business in countries that have been linked to state-sponsored terrorism and the proliferation of biological, chemical and nuclear weapons.
The Investor Responsibility Research Center and the Conflict Securities Advisory Group plan to introduce the new research product—the Global Security Risk Monitor—later this month.
The groups have identified public companies worldwide that do business in Iran, Iraq, Libya, North Korea, Sudan or Syria and assesses their potential risk. All of the countries have been designated by the U.S. government as state sponsors of terrorism and are pursuing acquisition of weapons of mass destruction and ballistic missile delivery systems.
About 300 companies worldwide have been identified as having risk to their reputation and stock price, including more than a dozen on the Standard & Poor’s 500 Large Cap Index. Catherine Sheehy, director of IRRC’s Corporate Benchmarking Service, declined to name the companies, saying the information would only be available to subscribers.
During a conference call, IRRC did cite Canadian oil company Talisman Energy and French automaker Renault as potential members of the list because of business relationships in Sudan and Iran, respectively.
Chad Bray, Dow Jones Newswires; 201-938-5293; email@example.com