According to new research by the international climate non-profit Stand.earth, Canadian financial giants Manulife, RBC, CIBC, BMO and others are investing millions in Russia’s three largest oil and gas companies including Gazprom, Lukoil and Rosneft.
Stand.earth compiled the data utilizing special financial software called a “Bloomberg terminal” that tracks investments in real-time.
In total, the financial institutions hold more than US$110 million worth of investments in the Russian oil companies, National Observer reported.
Insurance giant Manulife holds some $14.7 million worth of stock and roughly $7 million worth of Gazprom bonds in addition to around $39 million in Lukoil stock and some $590,000 worth of bonds. Manulife’s stake in Rosneft, a Russian state-owned oil giant, is roughly $5.8 million.
“Together, Manulife’s exposure to the three Russian oil and gas companies adds up to about $67 million, or about 60 per cent of the total investments of identified Canadian financial institutions,” National Observer reported.
According to the data, the Royal Bank of Canada (RBC) owns some $6.3 million in shares of Lukoil and over $31 million worth of bonds from Gazprom. The Bank of Montreal (BMO) is in a similar position owning $4.3 million worth of shares in Lukoil and slightly over $240,000 worth of shares in Rosneft.
Smaller financial institutions and asset managers with stakes in Russian oil companies include, AGF Management, MD Financial Management, Sun Life Financial, Desjardins Trust, Fidelity Investments Canada, 1832 Asset Management and Power Corp of Canada, according to the National Observer.
Stand.earth International Programs Director, Tzeporah Berman, writes on the non-profits website,“We know that Russia’s illegal invasion of Ukraine has been underwritten by oil and gas money, and this new research shows how Canadian institutions are complicit in the bloodshed. RBC, BMO, and Manulife need to step up the pressure on Russia to end this conflict by immediately divesting from Rosneft, Lukoil and Gazprom.”
The data demonstrates how intertwined the Canadian and Russian economies are and calls to divest have emerged. Berman writes, “The [Canadian] federal government should also mandate divestment [from Russian oil companies] across the board for all Canadian financial institutions in the next round of sanctions.”
Stand.earth argues that “oil and gas exports from Rosneft, Gazprom and Lukoil are essential to Russia’s ability to fund its military, and its ability to maintain leverage in global politics.
Should Canadian financial institutions divest from Russian energy companies the impact of doing so may be too little to register. Rosneft posted revenues of $122 billion in 2021 alone. The combined total of Canada’s investment in Russia — some $110 million — is extremely small in comparison and efforts to divest may be more symbolic than effective and would do little to hamper Russia’s military.
However, some companies and pension fund operators have started to divest from Russian oil companies. BP recently announced it would sell its 19.75 percent voting stake in Rosneft, effective immediately, and New York State has introduced a bill that would direct the state pension funds to divest from Russian oil companies.
The Canadian government has banned oil imports from Russia — a largely symbolic gesture since Canada imports little to no energy products from Russia — however Canada has not taken any action on financing.