Control BAE: CAAT at BAE Systems AGM
Press scrum outside the AGM
CAAT’s first ‘Control BAE’ campaign action took place at BAE Systems’ annual shareholder meeting in May. CAAT supporters hold a number of ‘token shares’ in BAE Systems, which enable them to attend the company’s AGM. The AGM is the one time in the year when board directors face shareholders to discuss the company’s activities. It provides CAAT supporters with a chance to directly challenge the board about BAE’s deadly trade.
This year, the top dogs tried desperately to dodge a barrage of questions from campaigners, mainly over the dropping of the SFO investigation. Despite a smooth and often choreographed performance by BAE’s chairman Dick Olver, it was clear that he was avoiding the real issues. Sprinkling his answers with the words ‘ethical’, transparent’, ‘open’ and ‘fulsome’, it was clear that Olver was trying a little too hard to get rid of the bad taste of the word ‘corruption’.
attended BAE’s AGM in May, from all over the country and from all walks of life. From pensioners to students to nurses to an ex-MP from South Africa, we were a formidable bunch for the board to contend with.
The AGM took place in the vast auditorium of the Queen Elizabeth II Conference Centre, just over the road from Parliament, and a regular host to the rich and powerful. Looking up from my front row seat at the white middleaged board (all men apart from one woman, who was stepping down after the AGM), high on their podium and accompanied by graphs and diagrams detailing this year’s profits from conflict, it was difficult at first not to feel slightly sick. How is it that these people can sit here and get away with talking about selling arms as if it’s a normal business activity? I thought to myself. How can we live in a world where people can justify selling weapons to kill other human beings in order to make profit?
But, of course, not letting them get away with behaving as if it’s business as normal is exactly why we were there. And making it clear that profiting from killing is totally unacceptable, and challenging these powerful men is exactly what we did.
In his introduction to proceedings, Chief Executive Officer Mike Turner tried to pre-empt criticism surrounding the SFO investigation, saying that press reports had ‘seriously distorted’ perceptions of the situation. However, his attack on the press didn’t deter most of the national broadsheet newspapers from reporting on the AGM, reminding the UK public of the corruption allegations and highlighting that Olver dodged numerous questions from shareholders. Even the Times advised that “until the company comes clean on exactly who it has paid and for what, the allegations of bribery and corruption will not go away”. Extensive news reports the next day were also accompanied by photos of CAAT’s peaceful protest outside the meeting. This highlighted the role of Mike Turner and Tony Blair in the dropping of the SFO investigation.
After smooth introductions from the board, Dick Olver invited questions from the floor, saying that he wanted this to be a chance to ask questions and give them ideas about ‘your company’. We took him at his word. The question and answer session was dominated by questions from CAAT shareholders, and we certainly gave him a run for his half a million pound salary. Could he confirm whether BAE had ever paid bribes, yes or no? Why did he lobby to end the SFO investigation? Why was it necessary for BAE to use offshore companies? Could he give explicit assurance that not one penny went to the South African government when BAE was striking its deals?
With most of the questions relating to corruption, Olver resorted to waving around a copy of BAE’s ethical policy document, which, he assured, is rigorously enforced and proves that BAE has a ‘zero tolerance’ approach. He also repeatedly grasped at the straw of the Attorney General Lord Goldsmith’s words in justifying the dropping of the SFO investigation, saying that it was “doomed to failure” . When it was pointed out that Lord Goldsmith’s opinion was irrelevant when it came to the due process of the investigation, and that it was the opinion of the heads of the SFO themselves that mattered, Olver simply didn’t answer the question and looked for another hand amongst the sea of shareholders.
A just perceptible expression of relief would come across the Olver’s face on the few occasions when he realised he’d managed to invite a ‘real’ shareholder to ask a question. But even they were on their feet asking the board about corruption and questioning why BAE had lobbied to have the SFO case dropped. The only moments of true support from a real shareholder turned Olver’s expression to one of acute embarrassment. The gentleman rose to his feet to applaud the company on how they were conducting their business, which in his opinion was clearly “not corrupt”. “When you sit and have dinner with a client” he said, “that’s not corruption... When you have a case of wine and you offer one bottle to the person you’re trying to do business with, that’s not corruption”. But what about the next logical step in this argument, when the bottles of wine turn into cuts of a few billion pounds, holidays and prostitutes? Did this man still not think it was corruption? Olver didn’t wait to find out where this praise was going and tried desperately to cut short his trusted shareholder’s acclamations. Evidently this example of ‘real’ company shareholder values was something he didn’t wish to have highlighted in quite such a public way.
Towards the end of the question and answer session, six of us made a final symbolic stand against the board. Pulling on judge’s wigs, we stood in front of the wall of suits, calling out “we find you guilty”. If the Government isn’t going to let justice be done, we thought, well, we’ll just have to sit in judgement of the company ourselves!”
Other campaign information and updates
On 19th April CAAT, together with the social justice research group The Corner House, lodged the full grounds for a judicial review of the UK government’s controversial decision in December 2006 to terminate the Serious Fraud Office investigation into alleged corruption by BAE Systems over its Al Yamamah arms contract with Saudi Arabia.
Lawyers for the two groups are arguing that the termination was unlawful as it breached the UK’s undertakings under the OECD Anti- Bribery Convention. The UK government had said that continuing the investigation would have damaged national security because it would have harmed relations with Saudi Arabia. However, the OECD Anti-Bribery Convention expressly forbids consideration of the impact of corruption probes on relations with a foreign state. Furthermore, Saudi Arabia is legally bound by UN resolutions to supply intelligence relating to terrorism.
CAAT and The Corner House had delayed lodging their full case for judicial review pending the outcome of proceedings arising from the discovery that BAE had obtained an email containing the groups’ privileged legal advice (see here).
Public documents about the legal case as well as the latest information can always be found on our website at www.caat.org.uk.
On 2nd May, the Times reported that the Saudis are “deeply embarrassed” about the outcry that followed the curtailment of the SFO inquiry, and have stalled negotiations for more military equipment. Deals cited as being put “on ice” until the furore has died down include the purchase of two Type 45 destroyers costing £800 million each as well missile systems and Hawk jets.
The current deal, for Eurofighter jets worth £20 billion, is still scheduled for completion in July, but as the Times revelation demonstrates, until the weapons are delivered nothing is certain.
It has become clear that the United States was furious over the decision to stop the SFO investigation. A formal protest to UK’s Foreign Office was made in January and, more recently, it has been widely reported that the Justice Department is looking to see if it can launch its own inquiry. If some of the alleged payments were made within US jurisdiction, the BAE could be investigated under the strict Foreign Corrupt Practices Act.
All this might make it more difficult for BAE to do business with the Pentagon, which buys more from the company than does the UK Ministry of Defence.
Give us feedback on this page