In 2011, Cambodian farmers were forcibly evicted from their property in order to establish the Phnom Penh Sugar Refinery, funded by Australian Bank, ANZ. Inclusive Development International worked to ensure that ANZ compensated them for this human rights violation.
Problems and Purpose
Inclusive Development International’s (IDI) cornerstone project, “Following the Money to Justice” helps vulnerable communities across Asia and Sub-Saharan Africa trace funding behind harmful developmental projects that violate human rights and lead to loss of lives, property, and livelihood. This initiative began in 2016 in response to the global land-grabbing crisis that drove millions of people from their homes in order to support developmental projects. IDI supports these marginalized communities in developing advocacy skills to seek justice from the relevant actors. They also promote corporate accountability amongst multinationals, banks, and other organizations that fund and benefit from these infrastructural projects.
This case entry highlights one of their successful campaigns in Cambodia, where they secured compensation for an ANZ-backed landgrab in Cambodia.
Background History and Context
In the Thpong and Oral districts of Kampong Speu province in Cambodia, about 1100 farmers were forcibly evicted from their homes and farmlands in the years 2010 and 2011 by private military officers[1]. This was done to make room for Phnom Penh Sugar (PPS) refinery sugarcane factory and refinery, owned by Ly Yong Phat, a businessman who is also the Senator of Kong-Kroh[2]. Ly Yong Phat is a controversial figure in Cambodia, owning a number of the country’s nature reserves, including a zoo and a 600-acre concession of state land awarded to him by the Cambodian government[3]. He is nicknamed the ‘King of Kong Kroh’ and it is rumoured that this piece of land has been sold to him. The area is now the site of environmental activism by groups such as Mother Nature, given his notoriety for land owning and pursuing environmentally devastating developmental projects [4]. Land grabs in the name of new developmental projects have been a regular occurrence in Cambodia over the period, where vulnerable populations with little agency are forced out of their homes and livelihoods[5]. In 2014, a leaked Social and Environmental Impact Assessment report project exposed Australian Bank ANZ as being a principal financier of the project causing damage to the region largely and robbing farmers of their livelihood. IDI in conjunction with Equitable Cambodia exposed this news in both Cambodia and Australia. On top of this, IDI assisted the community in filing a formal complaint which led to ANZ compensating these farmers and creating a human rights grievance mechanism[6].
[1] Sok Khemara, “Australian Bank to Compensate Cambodian Farmers for Lost Land,” VOA, February 27, 2020, https://www.voanews.com/a/east-asia-pacific_australian-bank-compensate-cambodian-farmers-lost-land/6184966.html.;add idi website
[2] Inclusive Development International, “Cambodia: Securing Compensation for ANZ-Backed Land Grab,” Inclusive Development International, accessed September 26, 2023, https://www.inclusivedevelopment.net/cases/cambodia-sugarcane-land-grabs/.
[3] Gerald Flynn, “License To Log: Cambodian Military Facilitates Logging on Koh Kong Krao and Across the Cardamoms,” Pulitzer Center, accessed August 24, 2023, https://pulitzercenter.org/stories/license-log-cambodian-military-facilitates-logging-koh-kong-krao-and-across-cardamoms.
[4] Gerald Flynn and Meg Kroypunlok, “Cambodia Awards Swath of National Park Forest to Tycoon Ly Yong Phat’s Son,” Mongabay Environmental News, July 26, 2023, https://news.mongabay.com/2023/07/cambodia-awards-swath-of-national-park-forest-to-tycoon-ly-yong-phats-son/.
[5] Inclusive Development International, “Cambodia.”
[6] followingthemoney.org, “Cambodian Communities Use Australian National Contact Point to Reach Groundbreaking Agreement with ANZ Bank - Following the Money,” January 31, 2022, https://www.followingthemoney.org/cambodian-communities-use-australian-national-contact-point-to-reach-groundbreaking-agreement-with-anz-bank/.
Organizing, Supporting, and Funding Entities
IDI has stated on its website that it received support from partners in Australia and around the world to increase their advocacy. They list their partners as; Equitable Cambodia, OECD Watch, BankTrack, Oxfam Australia, and the Uniting Church of Australia. They also spoke to a number of journalists, which gave members of the community in Cambodia the opportunity to speak to several news outlets. [1]
[1] Inclusive Development International, “Cambodia.”
Participant Recruitment and Selection
Advocacy was facilitated by IDI, however, community representatives from the Thpong and Oral Districts of the Kampong Speu province went into talks with ANZ to push for compensation[1].
[1] Nick McKenzie Baker Richard, “Victims Put Pressure on ANZ over the Loss of Their Land,” The Age, February 23, 2017, https://www.theage.com.au/national/victims-put-pressure-on-anz-over-the-loss-of-their-land-20170222-guiin4.html.
Methods and Tools Used
IDI employed a combination of a number of methods and tools in order to achieve their aim of securing compensation for these Cambodian families ensuring that ANZ took accountability for their actions and IDI describes their strategies as ‘multi-pronged’ and ‘creative’. The methods they used include[1];
Media Advocacy: IDI contacted several journalists and news outlets to ensure that this issue made headlines, placing further pressure on ANZ.
Consumer and shareholder advocacy: Pushing ANZ to modify and strengthen their human rights policy to protect communities. They also joined an external advisory group to assist ANZ in developing a Grievance Mechanism Framework.
Complaints: Interactions with the Australian National Contact Point for Responsible Business Conduct- an Australian government organization mandated to uphold the OECD Guidelines for Multinational Enterprises and address claims of corporate misconduct.
[1] Inclusive Development International, “Cambodia.”
What Went On: Process, Interaction, and Participation
2010/2011- Land grab and displacement
Police and military appointed by the Phnom Penh Sugar Plantation and Refinery executed the land grab which forced the removal of individuals and families from their homes[1].
January 2014: Information Leak and Publicity
A Social and Environmental Impact Assessment leak revealed the ANZ backed loan to Phnom Penh refinery project. IDI and Equitable Cambodia worked to ensure that the ANZ’s involvement in the displacement of families went public and was reported by several news outlets in Australia, Cambodia and across the world[2].
2014: ANZ and Phnom Penh Sugar Company part ways
IDI fixed a meeting with the bank and the affected communities to listen to the latter’s grievances and obtain a clearer picture of the harm the bank had facilitated[3]. In this meeting, representatives of the community provided accounts of the loss and damage they had experienced at the hands of the bank’s investment. Some of which included removing their children from school to work on the sugar plantation due to parents’ loss of livelihood[4] [5].
A spokesperson for ANZ also announced publicly that the bank has parted ways with Phnom Penh Sugar Company as the company has repaid its loans[6].
ANZ cut ties with PPS and pushed them to compensate the victims. The victims were allegedly paid 100USD and relocated to infertile lands[7]. IDI believed the bank could use their leverage to do more for these communities, and therefore pushed harder for them to do so.
2017: Australian National Contact Point for Responsible Behavior Report
IDI, in conjunction with Equitable Cambodia issued a complaint about ANZs dealings with PPS to the Australian National Contact Point for Responsible Business Conduct and argued that ANZ owed the people a responsibility to remedy their actions [8]. There was however immense difficulty in achieving this as the National Contact Point, apart from being little known, is a small office with limited capacity to conduct such a review. Also, this kind of complaint was the first of its kind for such a major financial institution [9].
2018: “Failed to Meet Human Rights Standards”
The Australian National Contact Point underwent a restructuring in 2018 with more capacity to address concerns. The National Contact Point clearly stated that ANZ did not meet human rights standards.[10] It also encouraged ANZ to develop a human rights grievance mechanism, which ANZ promised to do. Unfortunately, the National Contact Point’s recommendations and statements were not enforceable and little to nothing to improve the situation in Kong Krao.
[1] Inclusive Development International.
[2] Inclusive Development International.
[3] Richard Baker McKenzie Nick, “ANZ under Fire for Loans to Controversial Cambodian Sugar Plantation,” The Sydney Morning Herald, January 22, 2014, https://www.smh.com.au/national/anz-under-fire-for-loans-to-controversial-cambodian-sugar-plantation-20140122-3196z.html.
[4] Baker, “Victims Put Pressure on ANZ over the Loss of Their Land.”
[5] McKenzie, “ANZ under Fire for Loans to Controversial Cambodian Sugar Plantation.”
[6] Daniel de Carteret, “ANZ Royal and Sugar Firm Part Ways,” accessed September 25, 2023, https://phnompenhpost.com/business/anz-royal-and-sugar-firm-part-ways.
[7] Marta Kasztelan, “ANZ Bank Accused of Abandoning Farmers after Splitting with Sugar Firm,” foodnavigator-asia.com, July 20, 2014, https://www.foodnavigator-asia.com/Article/2014/07/21/ANZ-Bank-accused-of-abandoning-farmers-after-splitting-with-sugar-firm.
[8] “ANZ Loan to Controversial Cambodian Sugar Firm Criticized by Australia,” Reuters, October 11, 2018, sec. Commodities, https://www.reuters.com/article/us-anz-bank-cambodia-idUSKCN1ML0K2.
[9] Inclusive Development International, “Cambodia.”
[10] “ANZ Loan to Controversial Cambodian Sugar Firm Criticized by Australia.”
Outcomes
IDI’s engagement with news media and parliament, amongst others to continue to apply pressure to ANZ for remediation of these communities eventually led to ANZ reviewing its human rights policies and coming out with a human rights grievance mechanism [1]. ANZ also paid the affected families the profits they received from the PPS loan in February 2020 [2].
This was a landmark decision considering that it was the first time a financial institution of this nature had gone on to compensate the victims of human rights violations committed by its clients, after acknowledging their actions. IDI’s website also indicates that this was “only the third known time in the 20-year history of the OECD’s National Contact Point system that a complaint process resulted in a concrete financial remedy for complainants”.
IDI continued to work with Equitable Cambodia to help in the distribution of funds to the communities.
[1] Khemara, “Australian Bank to Compensate Cambodian Farmers for Lost Land.”
[2] Inclusive Development International, “Cambodia.”
Notes
Most of this information is from desktop research obtained from the Inclusive Development International and Following the Money websites. Several news websites were also researched in order to understand the timeline of events and clarify information on the aforementioned websites.
Analysis and Lessons Learned
See Also
References
Baker, Nick McKenzie, Richard. “Victims Put Pressure on ANZ over the Loss of Their Land.” The Age, February 23, 2017. https://www.theage.com.au/national/victims-put-pressure-on-anz-over-the-loss-of-their-land-20170222-guiin4.html.
Carteret, Daniel de. “ANZ Royal and Sugar Firm Part Ways.” Accessed September 25, 2023. https://phnompenhpost.com/business/anz-royal-and-sugar-firm-part-ways.
Flynn, Gerald. “License To Log: Cambodian Military Facilitates Logging on Koh Kong Krao and Across the Cardamoms.” Pulitzer Center. Accessed August 24, 2023. https://pulitzercenter.org/stories/license-log-cambodian-military-facilitates-logging-koh-kong-krao-and-across-cardamoms.
Flynn, Gerald, and Meg Kroypunlok. “Cambodia Awards Swath of National Park Forest to Tycoon Ly Yong Phat’s Son.” Mongabay Environmental News, July 26, 2023. https://news.mongabay.com/2023/07/cambodia-awards-swath-of-national-park-forest-to-tycoon-ly-yong-phats-son/.
followingthemoney.org. “Cambodian Communities Use Australian National Contact Point to Reach Groundbreaking Agreement with ANZ Bank - Following the Money,” January 31, 2022. https://www.followingthemoney.org/cambodian-communities-use-australian-national-contact-point-to-reach-groundbreaking-agreement-with-anz-bank/.
Inclusive Development International. “Cambodia: Securing Compensation for ANZ-Backed Land Grab.” Inclusive Development International. Accessed September 26, 2023. https://www.inclusivedevelopment.net/cases/cambodia-sugarcane-land-grabs/.
Kasztelan, Marta. “ANZ Bank Accused of Abandoning Farmers after Splitting with Sugar Firm.” foodnavigator-asia.com, July 20, 2014. https://www.foodnavigator-asia.com/Article/2014/07/21/ANZ-Bank-accused-of-abandoning-farmers-after-splitting-with-sugar-firm.
Khemara, Sok. “Australian Bank to Compensate Cambodian Farmers for Lost Land.” VOA, February 27, 2020. https://www.voanews.com/a/east-asia-pacific_australian-bank-compensate-cambodian-farmers-lost-land/6184966.html.
McKenzie, Richard Baker, Nick. “ANZ under Fire for Loans to Controversial Cambodian Sugar Plantation.” The Sydney Morning Herald, January 22, 2014. https://www.smh.com.au/national/anz-under-fire-for-loans-to-controversial-cambodian-sugar-plantation-20140122-3196z.html.
Reuters. “ANZ Loan to Controversial Cambodian Sugar Firm Criticized by Australia.” October 11, 2018, sec. Commodities. https://www.reuters.com/article/us-anz-bank-cambodia-idUSKCN1ML0K2.
External Links
https://www.inclusivedevelopment.net/cases/cambodia-sugarcane-land-grabs/
https://www.followingthemoney.org/cambodian-communities-use-australian-national-contact-point-to-reach-groundbreaking-agreement-with-anz-bank/
Notes
Most of this information is from desktop research obtained from the Inclusive Development International and Following the Money websites. Several news websites were also researched in order to understand the timeline of events and clarify information on the aforementioned websites.