Colombia's 'dirty war' embroils BP

What Do Exxon, Elf, McDonalds, Freeport MacMoran, BP, Total and Shell have in common? All are embroiled in the hot topic of corporate governance in the 1990s: how to reconcile Western business ethics with the realities of doing business in emerging markets with equally "emerging" legal and civil rights structures.

All but one of the above companies have been targeted by environmental and human rights campaigners in recent years, accused of everything from careless pollution to deforestation and human rights abuses.

Last week, McDonalds emerged with a victory over two environmental protesters after a libel trial that went on for a record-breaking 313 days at the High Court, costing the company pounds 10m in legal fees and unquantifiable damage in terms of its public image.

After shareholder pressure, led by Pirc, the corporate governance lobbying group, over Shell's close ties with a Nigerian dictatorship that has been involved with human rights abuses, the company agreed to revise its environmental and corporate responsibility standards.

Now BP is under fire over its involvement in an oil project in Colombia's Casanare region. Human rights groups and environmentalists allege that the company has polluted a river and caused illnesses in humans and cattle near its plants. But BP's real difficulties in the region, where it operates exploration, production and refining operations under contract to the Colombian government, stem from the fact that it has to hire the Colombian army to protect its personnel from guerrilla groups bent on kidnapping and extortion. The army has resorted at times to murder and kidnapping in the name of "security". A week tomorrow ITV will screen the first of two World In Action documentaries about BP's involvement in Colombia's "dirty war".

According to an independent specialist on the oil industry in Colombia, BP is in fact being subjected to "a massive smear campaign", spearheaded by guer- rillas angered by the company's refusal to pay protection money.

The source, anxious not to be identified for fear of reprisals, believes that leading figures within Colombian human rights groups based in London, which have been leading the campaign against BP, are linked to the guerrilla groups and have been misrepresenting themselves to media organisations willing to believe that another western multinational is up to no good in the developing world.

The guerrilla movements' presence has created the climate of fear - mainly of kidnapping of personnel - that has forced multinational companies to rely on the Colombian army for protection. BP has spent nearly pounds 15m on such protection over the last three years.

BP's policy from the outset has been to resist all threats and demands from guerrilla groups for protection money, and to take steps to keep their staff secure. Human rights campaigners allege that BP helped the army track down "troublemakers", and cite a Colombian government report on the situation in Casanare as evidence. The company denies the claims.

Nevertheless, the close relationship between the army and BP has led to the company taking PR flak for some of the army's more crass human rights violations. The particular unit assigned to BP, the Eighth Division, is notorious for its thuggery towards locals and its lack of differentiation between guerrilla suspects and ordinary people.

But painting the guerrillas as bona fide human rights campaigners is wrong, according to the Colombia expert. "Ideologically the guerrillas are defunct. They are immensely rich and live by kidnapping and extortion. Because BP doesn't play ball, the ELN [a 'Maoist' group] is particularly eager to denounce it."

According to another (anonymous) Colombia expert, this wealth runs into hundreds of millions of dollars, sunk into hotels, ranches and investment portfolios, as a result of around 200 ransom payments over the last two years. "Morality here is shades of grey," said one expert.

Pirc director Anne Simpson said: "I spend a lot of my time trying to differentiate between legitimate movements in the affected countries and those that are making spurious claims."