Goldman Sachs to pay $5bn for its role in the 2008 financial crisis
Goldman Sachs will pay $5.06bn for its role in the 2008 financial crisis, the US Department of Justice said on Monday. “This resolution holds Goldman Sachs accountable for its serious misconduct in falsely assuring investors that securities it sold were backed by sound mortgages, when it knew that they were full of mortgages that were likely to fail,” acting associate attorney general Stuart Delery said in a statement. This is only the latest multibillion dollar civil settlement reached with a major bank over the economic meltdown. Goldman Sachs and Morgan Stanley, which earlier this year agreed to pay $3.2bn, are two of the last big banks to pay up. Bank of America agreed to pay the largest of the settlements, $16.6bn, in 2014. A year earlier, JPMorgan Chase paid about $13bn. Such settlements have been worked out by the Residential Mortgage-Backed Securities Working Group, which is co-chaired by New York’s attorney general, Eric Schneiderman. The deal includes no criminal sanctions or penalties and is likely to stir additional criticism about the Justice Department’s inability to hold bank executives personally responsible for the financial crisis. (Guardian)
Environment
Two-thirds of Europeans support ban on glyphosate, says Yougov poll
A prohibition on glyphosate, the most widely used chemical, was backed by two-thirds of Europeans, in a survey conducted by Yougov poll across the EU’s five biggest states. The herbicide is used in best-selling pesticides made by Monsanto, Dow and Syngenta, but it has divided scientific opinion. The World Health Organisation’s cancer scientists dubbed it “probably carcinogenic to humans” while the EU’s European Food Safety Authority declared it “unlikely” to pose a public health risk. Most of glyphosate use is for GM resistant crops and environmentalists say that it can kill all plants, algae, bacteria and fungi in a crop’s vicinity, creating knock-on effects for biodiversity. Glyphosate’s current license will run out in June, although a temporary extension could be granted while the EU agrees a position. An ensuing row over best scientific practice and industry involvement in the legislative process ended with the European commission unable to pass a proposal to relicense the substance for another 15 years. The vote on relicensing is thought to take place at a committee meeting in Brussels on 19 May. (Guardian)
Tax
Israel to levy new taxes on Google and Facebook in policy shift
Israel has expanded its definition of who must pay taxes on commerce. As much of today’s trade is carried out on the Internet, a foreign firm may now be considered a “permanent establishment” and subject to tax even if most of its presence is virtual, the Israel Tax Authority said. The authority said Internet multinationals will have to pay value added tax, which is 17 percent for Israelis. While the authority didn’t mention any companies name, domestic critics have singled out Facebook and Google arguing that the government’s failure to fully tax Internet companies gave the multinationals an unfair advantage over local businesses. The new taxes, will add hundreds of millions of shekels a year to state revenue, the authority said. The new taxes won’t clobber the internet giants, they build on broader efforts worldwide to level the playing field between foreign Internet companies and local commerce. (Bloomberg)
EU regulators demand greater tax transparency from multinationals
The European Commission will put forward legislation requiring large multinationals operating in Europe to disclose where they make profits and where they pay tax on a country by country basis. Companies trading in Europe, would also have to publish how much tax they pay outside the EU with specific information about tax paid in problematic jurisdictions. The Commission was already working on the measures but after the leak of 11.5 million files exposing the tax secrets of the global elite, officials have toughened up their plans to include subsidiaries in tax havens. The rules would apply to big US companies, such as Google, Amazon and Apple, which have courted controversy with complex arrangements for avoiding tax across multiple jurisdictions. The proposals are likely to face opposition from various quarters, including the US, which has claimed Brussels is targeting successful American companies. Business groups are also unhappy with plans to compel companies to disclose their profits to the public and not just the tax authorities. (Guardian)
Human Rights
Corporate human rights benchmark launches
A consortium led by Aviva Investors, and including Calvert Investments and Vigeo Eiris, has produced a 150 page pilot methodology for the Corporate Human Rights Benchmark (CHRB), which will publish its first ranking, of the top 100 companies from the agricultural products, apparel and extractives industries, in November. Inspired by the Guiding Principles on Business and Human Rights, the pilot methodology of CHRB adds weighting to the five key performance indicators, leadership, governance, management systems, performance and reporting/transparency, that were announced in July. “We do not yet have a wide-scale, publicly available way of identifying how companies are performing,” CHRB Steering Committee Chair Steve Waygood of Aviva Investors wrote in the report’s introduction. “As a result, companies and investors are not routinely incorporating the costs of getting human rights wrong or right into their investment decisions.” Respect for human rights and due diligence will make up 25 percent of the score of corporations being benchmarked, while two aspects of performance, corporate human rights practices and responses to serious allegations, each will make up 20 percent of company scores. (Greenbiz)
Image source: Crop spraying near St Mary Bourne by Brian Robert Marshall / CC BY-SA 2.0
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