CONTRIBUTOR
Yawen Chen Reuters
PUBLISHED DEC 23, 2021
(The author is a Reuters Breakingviews columnist. The opinions expressed are their own.)
HONG KONG (Reuters Breakingviews) - Norway's $1.4 trillion sovereign wealth fund has dumped a tiny stake in $19 billion Yunnan Baiyao, one of China’s top pharmaceutical companies specializing in so-called traditional Chinese medicine, or TCM, on grounds that the company uses pangolins, a species devastated by Chinese demand for its scales. Norway’s Council on Ethics, which makes investment recommendations to the pension fund, said it found Yunnan Baiyao’s use of pangolin unacceptable.
The TCM market, worth an estimated $150 billion, exploded during the pandemic as Beijing endorsed its claims of efficacy treating Covid-19. Global fund managers like Vanguard and BlackRock have exposure to the sector; shareholders in Hong Kong-listed China Traditional Chinese Medicine Holdings include the California Public Employees Retirement System and Quebec’s provincial pension fund, per Refinitiv data.
China has been tightening wild animal protection rules, but controversial animal practices persist. Western pressure might not deter ordinary Chinese people from believing rhinoceros horn is an aphrodisiac, or that pangolin scales treat arthritis, despite little scientific evidence. But a concerted global ESG campaign might convince Beijing, at least, to push for more reform. (By Yawen Chen)
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