Experience Stern | Faculty & Research

Last week, a French court found Lafarge, the world’s largest cement manufacturer, guilty of financing terrorist groups in Syria. It also held two former executives of the company criminally liable for their involvement in the scheme and sentenced them to five and six years in prison. In general, European and American courts have been very wary of prosecuting multinational companies for human rights violations in their global operations, partly because proving corporate intent in conflict zones is notoriously difficult. But the circumstances in this case were so extreme that the French court felt compelled to act. In doing so, it sent a clear message to multinational corporations worldwide that they, too, can be held accountable.

In order to operate in ISIS-controlled areas of Syria, the company Lafarge paid more than 5.5 million Euros (US$6.5 million) to ISIS and two other violent extremist groups to allow it to continue doing business in the war-ravaged territory. Lafarge issued travel documents to its drivers displaying the black Islamic State flag and text that read “In the name of Allah the Merciful, the mujahedeen are asked to let this vehicle transporting cement from the Lafarge plant pass through checkpoints, following an agreement with the company for the trade of this material.” As judge Isabelle Prévost-Desprez wrote in her opinion, “by knowingly paying extremely large sums over many months to three terrorist organizations, Lafarge SA enabled them to expand their influence and fuel their deadly campaigns, ultimately leading to attacks committed abroad as well as on French soil.”

Founded in 1833, Lafarge has grown significantly over its 190-year history, operating in all regions of the world. Its involvement in the Middle East dates back to 1864, when it sold 110,000 tons of lime used in the construction of the Suez Canal. The company is no stranger to ethically contentious business relationships. During World War II it provided concrete to the Nazis as they built the Atlantic Wall, their extensive defense system along the European coast to defend against the anticipated Allied invasion. It was not alone: the postwar Nuremberg tribunals convicted executives of I.G. Farben, the German chemical conglomerate that supplied Zyklon B to the Nazi death camps, establishing for the first time that corporate actors could be held criminally liable for complicity in atrocities. The Lafarge verdict suggests that principle, long dormant, is being revived.

Read the full Forbes article.
___
Michael Posner is the Jerome Kohlberg Professor of Ethics and Finance, Professor of Business and Society and Director of the NYU Stern Center for Business and Human Rights.