Starbucks relocates to ‘coffee capital of the world’, – and a bigger tax bill
Starbucks has hailed London as the Silicon Valley of the coffee industry after announcing it is moving its European headquarters to the city. The US giant has come under fire over its tax arrangements but said the move would result in an increase in the UK tax it pays, in what MPs described as a “pivotal victory”. Starbucks – which said it will open more than 100 cafes this year – also promised it will pay more tax in the UK because of the move of its European, Middle East and Africa headquarters from the Netherlands. The firm has been battling to repair its reputation since it emerged in 2012 that it reportedly paid only £8.6m in UK corporation tax over 14 years. (Independent)
Supply Chain
Rio Tinto heavily blamed by protesters over 41 mine worker deaths
Protesters and unions from around the world heavily criticised mining company Rio Tinto over alleged lapses in safety leading to the deaths of 41 people and a string of claimed environmental abuses, in its Indonesian Grasberg mine. Global trade union IndustriAll, which represents 50 million industrial workers across the world, accused Rio Tinto of “very wide breaches of fundamental rights” and said the Anglo-Australian mining company could have done more to prevent the 41 deaths last year. A company spokesman later said: “Rio Tinto does not manage the Grasberg operation, but we do not stand aside when fatalities occur. We are working with Freeport, the managers of the mine on safety, as well as community, human rights and other issues.” (Guardian)
UN-backed Rana Plaza schemes two thirds short of target
One year on from the Rana Plaza factory collapse in Bangladesh the UN-backed compensation fund has raised only $15m of its $40m target. The scheme calls on international retailers that buy clothing from Bangladesh to contribute to the fund. Dan Rees of the International Labour Organisation (ILO) said “it’s enormously frustrating that we haven’t got further… Rana Plaza was a scar on the entire industry and it is beholden on the entire industry to do what’s right”. So far, the British fashion chain Primark has made the biggest contribution paying out $12m for victims, $8m of which is counted as part of the ILO scheme. However, pressure is intensifying on those brands that are yet to contribute, such as Matalan, Benetton and the US retailer, JC Penney. (Guardian)
Climate Change
UK carbon capture scheme to be awarded €300m from Brussels
White Rose CCS development in North Yorkshire, a pioneering carbon capture and storage project in the UK, has qualified for a grant of €300m from Brussels. The grant will be awarded by a scheme known as ‘NER300’, run by the European Commission to support innovative green energy projects and up to 12 CCS schemes. Europe was once a leader in deploying this technology but has fallen behind the US and Canada due to factors which include high costs, the eurozone crisis and the collapse of the price of CO2 in the EU’s trading system. White Rose will be a new coal-fired power station that will provide electricity to more than 630,000 homes. Approximately 90 per cent of its C02 emissions are planned to be captured and will be piped deep into rock formations beneath the North Sea for permanent storage. It will be built next to Drax’s power station near Selby. Drax need to take a final investment decision before the contract proceeds. It is expected that White Rose will receive the grant by mid-2014. (Financial Times*)
Corruption
GSK caught in further allegations of bribery
GlaxoSmithKline (GSK), Britain’s largest pharmaceutical company, has confirmed it is investigating allegations of bribery in Jordan and Lebanon. Emails seen by The Wall Street Journal allege that GSK sales representatives bribed doctors to prescribe drugs and vaccines by giving them free samples that they could then sell on, pocketing the proceeds. This follows a BBCPanorama exposé this week that has seen Poland’s fraud squad charging 13 people in connection with allegations of bribery to promote GSK’s asthma drug, Seretide. GSK, however, maintains that it has found evidence of misconduct by only one of its employees in Poland. The firm also faces accusations from earlier in the month of using 16 state-employed doctors and pharmacists as paid sales representatives in Iraq. In 2013 the company reported 161 violations of its sales and marketing policies: a rate in line with that of other major pharmaceutical businesses. (Reuters, The Guardian)
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