CHRISTIAN AID has accused leading UK companies of creating
thousands of subsidiary companies in tax havens in order to conceal
The charity says that its research, published on Tuesday in the
report FTSEcrecy, has found that FTSE 100 companies have
created 29,891 subsidiaries, and that details of these
subsidiaries' turnover, assets, shareholder funds, and number of
employees are freely available in only one quarter (26 per cent) of
In others, information cannot be found, even if payment is made
to the relevant authority, such as Companies House - although in
the case of some companies, some fee-charging private databases
were able to supply some information.
The co-ordinator of the report, Katharine Teague, said: "What
our findings show is that secrecy is not the exception, but the
norm, even among the largest 100 companies whose shares are traded
on the London Stock Exchange.
"These are household-name firms in which millions of people
invest, through their pension funds and savings. But the secrecy is
so deep and widespread that it is like a blindfold on everyone who
has financial dealings with these companies."
Some 14 per cent of these subsidiaries operate in tax havens
rated as "highly secretive", including Luxembourg, Hong Kong,
Bermuda, and the Cayman Islands. Companies with the most
subsidiaries in highly secretive jurisdictions are from the
finance, banking, and mining sectors.
Ms Teague said: "If we want to ensure that the companies playing
ever larger roles in our societies are financially stable, socially
responsible, and well-regulated, then such secrecy must end.
Transparency won't guarantee well-behaved firms, but it is a
necessary condition for it."
Lack of transparency is a significant barrier to sustainable
growth and development. Last year, the African Union High Level
Panel on Illicit Financial Flows said that Africa is losing $50
billion a year in illicit financial flows, draining the continent
of much-needed resources.
Christian Aid, which has long campaigned for companies to pay
their fair share of taxes, is urging the UK and other governments
to require all companies to report their accounts on a public
country-by-country basis, requiring them to publish data such as
profits made, and taxes paid, separately, for each country in which
It also wants all jurisdictions to require companies registered
in their territory to submit accounts each year.
A spokesman for a FTSE 100 company, who did not want to be
named, told The Guardian newspaper that, although it was
important for information regarding large operating subsidiaries to
be easily accessible, the majority of subsidiaries were dormant