By Peter Koenig
Aug. 27, 2018
Glencore, according to statista.com is the world’s largest mining company by revenues. As a way of introduction, here is what statista.com has to say about Glencore.
“Glencore-Xstrata is a public limited company founded in 1974 by Marc Rich whose headquarters are based in Baar, Switzerland and also has registered office based in Jersey, Channel Islands. Glencore-Xstrata is also a mining company whose headquarters are based in the United Kingdom. On May 2nd, 2013, the current company was established through a merger between Glencore and Xstrata. Glencore-Xstrata is the third largest family owned business in the world and was ranked number 10 on the list of Fortune Global 500 in 2015. Glencore Xstrata is the leading mining company in the world with estimated revenue earned in 2017 of $205 billion, on a rebound from 2015 (US$ 147billion) and compared to the best year so far, 2012 (US$237billion). Net earnings have skyrocketed in 2017 to US$ 5.8 billion, more than 4 times higher than in 2016 (US$ 1.4 billion).”
The four next mining corporations in world ranking include BHP Billiton, Australia; British-Australian Rio Tinto; China state-owned Shenhua Energy, and Vale, Brazil. Their mining practices may not differ a lot from those of Glencore’s. However, what distinguishes Glencore is its particularly aggressive business style. Aggressive from all points of views – tax avoidance, corruption, total neglect for employees as well as communities they work in, non-responsiveness to critique.
Though it looks like Glencore’s aggressive business model is paying off. Glencore’s tax rate negotiated in Switzerland is next to zero. The Canton of Zug, where the city of Baar, seat of Glencore’s headquarters (HQ) is located, is the number one tax haven in Switzerland – Glencore pays 0.2% taxes on its net earnings.