French-Swiss cement maker LafargeHolcim came under fire this week after offering to supply materials for US President Donald Trump’s planned wall on the Mexican border. But the company has a long history of questionable business practices.
“It should reflect upon what its interests are. There are other clients who will be stunned by this,” French Foreign Minister Jean-Marc Ayrault told France Info radio on Thursday. “Lafarge says it doesn’t do politics… Very well, but I would say companies... also have social and environmental responsibilities.”
Ayrault’s comments were in response to LafargeHolcim CEO Eric Olson, who was quoted by AFP on Thursday as saying: “We are the number-one cement group in the United States... we are here to support the construction and development of the country... We are not a political organisation."
Yet LafargeHolcim’s offer is just the latest in a string of questionable deals the company has made over the past few decades.
World War II ‘Atlantic Wall’ construction
In the spring of 1942, at the height of World War II, Nazi Germany decided to bolster its defences on the Western Front by constructing the “Atlantic Wall” – a sprawling fortification of 15,000 bunkers along the coast from the Netherlands to the Pyrénées. A number of French companies were drafted to help build the rampart, with “80 percent of French cement at the time used in the construction of the French section of the Atlantic Wall", according to Géo magazine. This led to a major hike in the public works market, from 16 million French francs in 1941 to 671 million in 1943.
“The project was a chance, an economic opportunity for French businesses to continue working despite the occupation. In this context, Lafarge was just one of many,” Jérôme Prieur, author of “The Atlantic Wall – A Monument to Collaboration”, told FRANCE 24. “Two of its factories produced cement for the Nazis: one in occupied territory, near Angoulême [in the west of France]. The other was in unoccupied territory, near Ardèche [a region in the southwest]. Paradoxically, it was the factory in the free zone [before it was invaded by Nazi forces in November 1942] that showed the most zeal for the German war effort”.
Although Lafarge was not the only French business guilty of economic collaboration, it emerged from the war with a competitive advantage. “The war wasn’t a down period for the company,” Prieur said. “Lafarge, which was already a major cement producer, maintained its status thanks to its economic collaboration with the Germans. It and other companies that collaborated on the economic level were also best placed to undertake reconstruction efforts after the war, because of their continued activity during the occupation.”
Profiteers in EU fight against climate change
In an effort to fight against the effects of climate change, the European Union set up the world’s first and largest international carbon emissions trading system in 2005. The idea was to prevent a rise in emissions by capping the amount of greenhouse gases a company could produce, before gradually reducing quotas to limit the impact on the environment.
But major European industrial companies have been able to profit off the system by lobbying for higher quotas and then selling off the surplus, raking in €8 billion between 2008 and 2014, according to a report commisioned by the non-governmental organisation (NGO) Carbon Market Watch. One of the sectors that has benefitted the most is cement, with Lafarge taking a large piece of the pie.
Merger with Holcim, a company with a dubious past
Lafarge’s merger with Holcim has done little to redeem its reputation. The Swiss cement company’s past is just as dubious, if not more so. In one case, it was ordered by Australia to pay more than $280,000 for damaging Aboriginal rock art, stone arrangements and sacred places at a National Heritage site. It has also been fined numerous times in the United States for violating limits on pollution, according to the NGO CorpWatch. In 2013, the US Environmental Protection Agency (EPA) announced that it had reached a settlement with Holcim that included a $700,000 fine, as well as at least $20 million of investments to resolve violations of the Clean Air Act.
Suspected financial ties with IS group in Syria
In June 2016, French daily Le Monde reported that Lafarge was suspected of having established ties with the Islamic State (IS) group, in order to keep its Jalabiya factory in northern Syria running. According to the newspaper, the cement company tasked an intermediary with obtaining free passage from the jihadists for its employees at checkpoints. Truck drivers were allegedly issued documents stamped by the IS group allowing them to access the site, raising suspicions that Lafarge had paid some sort of inducement.
Lafarge’s headquarters in Paris were apparently aware of the arrangement, Le Monde reported, citing company emails. A week after the article appeared, LafargeHolcim chairman and former CEO Bruno Lafont told FRANCE 24: “The nature of the allegations made in the newspaper are not who we are. We have launched a very precise and thorough examination of the facts." A spokesperson, meanwhile, stressed that “Lafarge’s priority has always been to ensure the safety and security of its staff."
Unmoved by the company’s response, the French economy ministry filed a complaint against LafargeHolcim with the Paris prosecutor’s office for failing to comply with a European ban on working with terrorist organisations in Syria.
Last week, the company acknowledged that the Jalabiya factory had probably struck a deal with militant groups in Syria, describing the situation as “unacceptable”.
This article was translated from the original in French.