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Title:Focus: tax evasion and CSR
Date of publishing:August 22, 2013
Also available in the following languages:Dutch, French

Focus: tax evasion and CSR
August 22, 2013

Controversies about the involvement of major banks and multinational corporations in large-scale tax evasion and avoidance have severely troubled the pens of the international media in recent months. At the G8 summit of June 18th, world leaders translated their concern about the fiscal responsibility of companies with regard to the developing countries in which they operate in, in the 10 principles of the Lough Erne Declaration. In April, the International Consortium of Investigative Journalists  (ICIJ) revealed the names of several major banks involved in secret companies, trusts and funds. A few weeks later the same consortium bewildered the public opinion with the publication of the Offshore Leaks Database, a list of more than 100,000 opaque financing vehicles in tax havens. It is estimated that the governments of developing countries missed out approximately USD 5.86 billion between 2001 and 2010. For the poorest countries, the same figure is estimated at USD 1 billion.

Reason enough for Vigeo to give tax evasion a higher profile in its research methodology and to apply the criterion on the case study of the European banking sector. The research results are startling: none of the 28 banks surveyed displays any effort to go beyond legal compliance; less than half of the banks refer to tax avoidance or tax evasion in their policy documents; proactive measures to reduce the risk of tax evasion or other forms of abuse are virtually nonexistent. Such findings are obviously inconsistent with the role of banks with regards to the community in which they operate and they question the banks’ licenses to operate.

The main stakeholders in the tax problem, according to the ICIJ, are BNP Paribas, Crédit Agricole, Deutsche Bank, Crédit Suisse and UBS (shadow companies, secret trusts and funds). In second line follow HSBC, Barclays, Lloyds and Royal Bank of Scotland (strong offshore presence) and Intesa and Unicredit (involved in research on tax evasion).

Crédit Suisse, KBC, Svenska Handelsbanken and Unicredit clearly state that they will not assist in circumventing tax regulations. Société Générale and Swedbank are the 'stars' of the class; the first one with a tax code of conduct and the other with strong views on the link between taxes and the respect for human rights.

Read the full document of Vigeo.