After 1918 and the end of the German Empire, BASF and other companies quickly came to terms with the new rulers and immediately regained their access to power. This enabled them to win a 10-year tax waiver. In 1925, corporations including Bayer, BASF and Hoechst merged to form the conglomerate IG Farben. IG Farben was the world’s largest chemical company at the time, and the merger considerably strengthened the corporations’ political clout. IG Farben made lavish donations to the bourgeois parties, but it also had emissaries within them who met regularly as part of a working group attached to the conglomerate’s supervisory board. This illustrious circle was known as the Kalle Circle, and it was named after Wilhelm Ferdinand Kalle, a member of IG Farben’s administrative board. Kalle was also a representative of the German People’s Party. However, the managers of these corporations were not content with merely joining political parties; they also adopted important offices within the governments of the Weimar Republic. Thus, between November 1929 and June 1930, Paul Moldenhauer, a member of IG Farben’s supervisory board, became minister of economic affairs under Chancellor Hermann Müller and then minister of finance under Chancellor Heinrich Brüning. Moldenhauer’s colleague Hermann Warmbold, a long-time member of BASF’s executive board, served as minister of economic affairs between October 1931 and January 1933 under chancellors Brüning, Franz von Papen and Kurt von Schleicher. This approach to politics is also clear from a statement made by Carl Duisberg, the chair of IG Farben’s supervisory board, who explained, ‘I’ve given up trying to influence the parties using reason! All difficulties can be overcome through planned influence’ (Schneckenburger, 1988:46).
When the NSDAP (Nazi Party) rose to power, however, IG Farben maintained its distance from the party for a long time. This only changed once the conglomerate had realised that the Nazis could help it out of a tricky economic situation. IG Farben was incurring losses in Germany owing to its attempts to extract petrol from coal. In the early 1930s oil prices began to fall, and IG Farben’s venture proved to have been an enormous error of judgement. In June 1932, however, the conglomerate plucked up its courage to arrange a meeting with the NSDAP. Heinrich Bütefisch, head of the BASF plant in Leuna, and Heinrich Gattineau, who was responsible for trade policy at IG Farben, visited the party leader – Adolf Hitler – who signalled his support. During the Nuremberg trials, Bütefisch was to state for the record that ‘Hitler promised to provide our petrol production with the necessary protection’ (Gattineau, 1947:231).
Following the meeting with Hitler, IG Farben’s board of directors immediately decided to proceed with coal hydrogenation rather than write off losses of 300 million Reichsmarks. This decision paid off when Hitler kept his word. In December 1933, Hitler sealed the Petroleum Agreement with representatives of the conglomerate; it granted IG Farben a guaranteed price, a return of 5 per cent and write-off options. Bütefisch later expressed how happy he was with this decision: in 1941, he wrote, ‘Now we know that our haste was necessary [...] The reassuring certainty provided by ensuring that the Luftwaffe’s and the other significant sections of the Wehrmacht’s supply of fuel in Germany were free of foreign influence would have been at risk if we had acted more hesitantly’ (Köhler, 2017).
As had been the case during the First World War (the ‘Saltpetre Promise’),1 the chemical industry proved indispensable to the warlords. In fact, IG Farben even took care of planning the minute details. Carl Krauch, who was a member of the conglomerate’s board and had managed BASF’s Merseburg ammonia plant since 1912, prepared a memorandum entitled Zur Vorbereitung der Industrie auf den Krieg (Preparing industry for war) for the Ministry of War. Moreover, in his role as Wehrwirtschaftsführer (head of a company that was essential for the war effort), Krauch decisively shaped the ‘four-year plan’ that was intended to make industry ready for war. This placed IG Farben in a position where it could make rich pickings from the plundering undertaken by the Nazis. Only a few days after the Anschluss of Austria, Krauch and colleagues drew up a memorandum aimed at restructuring Austria’s chemical industry, and this pattern was to be repeated throughout the Second World War. Joseph Borkin went on to describe IG Farben’s actions in the following terms: ‘IG Farben followed the Wehrmacht into the countries it was overrunning like a jackal following a lion’ (Borkin, 1979:91).
IG Farben also played a decisive role in other crimes committed during the Nazi regime. The conglomerate’s subsidiary Degesch supplied Zyklon B for the gas chambers, and IG Farben not only operated a plant close to Auschwitz but also had its own concentration camp to guarantee its facility with a supply of forced labourers.
After 1945
After the demise of the Third Reich, the directors of IG Farben sensed that problems might be looming: Georg von Schnitzler, a member of its executive board, pointed out that ‘should financial claims be made, the material that would be relevant to these cases would rob our defence lawyers of their sleep’ (Greiner, 1995:219). Initially, things did not seem to be going particularly well for the conglomerate. A team under US Treasury Secretary Henry Morgenthau collected evidence against IG Farben and concluded that ‘if Allied policy aims to ensure that “Germany will never again be able to threaten its neighbours or the peace of the world”, then IG Farben must be destroyed, together with its factories that are vital for war’ (Greiner, 1995:243). However, things were to turn out differently. Morgenthau’s hard line was forced into the political defensive in the United States. US industry, which had extensive business relations with German corporations, played a significant role in this U-turn, as it demanded that the US government secure their markets instead of implementing a ‘tabula rasa strategy’ in Germany. Furthermore, the anti-Hitler coalition had split, and this led the Allies to change their priorities. The Cold War also meant that a strong Germany was needed to act as a ‘frontline state’. As a result, the Americans, British and French distanced themselves from the destruction of IG Farben and, instead, a break-up of the conglomerate was now on the agenda. However, the Allies still shied away from completely untying the areas in which the conglomerate was most strongly intertwined. Although the original plan had been to divide IG Farben into 50 ‘independent units’, this was reduced to 12; ultimately, however, IG Farben was split into just four successor corporations: BASF, Bayer, Hoechst and Casella.
There was no Stunde Null (zero hour) for IG Farben’s staff either. The new corporations continued to rely on their ‘well-deserved’ IG Farben personnel. In 1952, Dr Carl Wurster, a former Wehrwirtschaftsführer (rank of an NSPAP party member officer who was responsible for economic relations) who had been in charge of the inorganic chemistry laboratory and pilot plants at BASF in Ludwigshafen, returned to his previous employer to chair its executive board. It was not long before the corporations regained their old strength: just 20 years after their ‘restart’, BASF, Bayer and Hoechst were already as big as IG Farben had been during its heyday.
‘Action Kohl’
The ‘planned influence’ exerted over the political parties, as described by IG Farben’s director-general, Carl Duisberg, in the 1920s, was to reach an interim peak around 50 years later as part of ‘Action Kohl’.
BASF developed a particularly intimate relationship with politics during the Kohl era. Helmut Kohl had worked at BASF during his studies and had remained true to the chemical industry, returning after a short intermezzo at an iron foundry. Between 1959 and 1969, Kohl was an adviser to the Rhineland-Palatinate section of the German Chemical Industry Association (VCI), which is located in Ludwigshafen, alongside the headquarters of the association’s largest member, BASF. In 1959, Kohl was elected to the state parliament in Frankfurt as its youngest member. It was no coincidence that Kohl’s political career had begun to pick up speed at this time. The publicist Werner Rügemer emphasises, ‘Kohl’s employer not only paid Kohl for his advisory role, but also promoted the politician’s simultaneous and costly rise within the Christian Democratic Union at the national level’ (Rügemer, 2017). Kohl’s rise within the party reached its climax when he became minister president in 1969.
From 1973 onwards, Helmut Kohl’s advance through the ranks of the CDU at the national level was mainly supported by the corporations Flick and Henkel – represented by Eberhard von Brauchitsch and Kurt Biedenkopf. They were ‘committed to Action Kohl’ because they did not trust the CDU leader Rainer Barzel politically and believed that he had very little chance of winning an election. As such, they intended to ensure that ‘Dr Kohl takes over the party chairmanship and the task of renewing the party at the organisational level and its manifesto’ (Neues Deutschland, 26 August 1995). This plan was drafted by Kurt Biedenkopf, the CEO of the Henkel corporation in May 1973. Chemistry was in Biedenkopf’s blood: his father had been a director of IG Farben and a Wehrwirtschaftsführer. In May 1973, the first ‘100,000 Deutschmarks due to Kohl’ (Neues Deutschland, 26 August 1995) were provided to manage the political landscape – the corporations soon reaped the benefits of their plan, as Kohl was made party chair. However, neither Brauchitsch nor Biedenkopf wanted to permit Kohl to go it alone, and Biedenkopf therefore decided to join him as CDU general secretary.
During Biedenkopf’s time in the CDU, he was able to ‘top up’ his pay to ensure that he did not incur any loss of salary: Biedenkopf received payments via the CDU’s slush fund – which Flick2 and colleagues had largely financed via the Staatsbürgerliche Vereinigung (Civic Association). The Civic Association, which was founded in 1954, had plenty of money – between 1969 and 1980 it received about 100 million euro. Unsurprisingly, BASF was also one of its donors. In fact, this situation even resulted in BASF’s former CEO Matthias Seefelder having to answer to the courts after he was investigated by the Bonn public prosecutor’s office in 1985 for tax evasion.
Kohl’s intimate relationship with BASF is also illustrated by an object that he always carried with him: a BASF diary. When Kohl died, the corporation expressed a commensurate level of sympathy: BASF director Kurt Bock stated, ‘Helmut Kohl had a lot to do with BASF: he visited us as a member of parliament, as minister president of Rhineland-Palatinate and as federal chancellor of Germany. In 2015, nothing could stop Helmut Kohl from celebrating our 150th anniversary with us and showing his commitment to the company – in fact, this was one of his last personal appearances’ (Handelsblatt, 18 July 2017).
Securing access to raw materials
Today, BASF is still heavily involved in political ‘landscape management’, especially when it comes to securing access to raw materials. The three-way catalytic convertors that BASF produces are a good example. These products provide around 10 per cent of the corporation’s sales, but catalyst production requires huge amounts of platinum. BASF acquires platinum worth around 2 million euro every day from a single South African mining operator, Lonmin. The corporation also requires a significant amount of cobalt, nickel, rhodium and rare earths. Moreover, it even produces and sells crude oil and natural gas through its Wintershall subsidiary. BASF also trades in platinum and palladium and holds a 6 per cent stake in Deutsche Rohstoff AG, which has access to minerals such as tin, rare earths, tungsten, molybdenum, gold and silver.
At the same time, BASF acts as a service provider to the mining sector. The solutions provided by the South African branch of BASF’s Global Mining Solutions in Johannesburg, for example, include processes to separate ores from rock, reagents for further processing, as well as technologies for water recovery and solvent extraction.
However, it is hard to speak of any form of ‘business as usual’ within the commodities sector, as the industry faces numerous uncertainties. In many places, low mineral deposits are compounded by rising demand now that China has entered the market, and modern developments such as electric motors are leading to a run on many of these resources. In addition, minerals hold tremendous political power. In cases where they are not directly causing civil wars, they are often being used to finance them, as was the case with the Congo. Moreover, if peace has been established in a resource-rich country, it is often because a deadly calm is being enforced by an authoritarian regime. Finally, the latest BASF annual report (2017) points to a further risk: ‘We expect many commodity suppliers to expand their value chains.’ In this context, South Africa is planning on preventing large corporations from receiving the lion’s share of the revenues they gain from selling minerals.
These are the reasons why corporations seek assistance from politics. Above all, businesses are particularly concerned with securing access to resources. In 2005, the Federation of German Industries (BDI) sounded the alarm and organised its first Raw Materials Congress, stating, ‘Raw materials that are essential to industry are becoming increasingly scarce, because of increasing demand from China, other emerging economies, and the growing global economy.’3 The lobbyists at the BDI were even able to summon up a prominent guest to attend their event – the incumbent German federal chancellor, Gerhard Schröder, who would have certainly understood the pertinence of the question ‘What must politics in Germany and Europe do to secure the supply of raw materials and energy in the future?’4 The BDI already had the answer: it called on the German government to develop a ‘raw materials strategy’.
Importantly, the Raw Materials Congress was not only dedicated to the ‘need’ for a raw materials strategy. It also covered issues such as ‘resource availability and geostrategic risks’, ‘future developments in the commodity markets’ and ‘commodity problems in the value chain’. The BASF manager Gabriel Tanbourgi took to the podium to speak about the last of these issues.
The BDI argues that the German government should treat the issue of securing access to resources as a cross-departmental task and not merely focus on its economic aspects. The association maintains that German foreign policy in general and development policy in particular should also play an important role in securing corporate access to raw materials. In 2007, at the panel discussion ‘Raw Material Security: A Challenge for Development Policy’, which was organised by the Konrad Adenauer Foundation, a BDI representative contended that ‘development policy can contribute to our raw material security when it promotes the stability of these countries, ensures that mining concessions are awarded transparently, and enables raw materials to be transported faster and more easily’.5
The Commodity Alliance, which was co-founded by BASF and has recently been reintegrated into the BDI, even wanted to involve security policy; if necessary, access to their coveted treasures was to be secured by force. This led Handelsblatt to summarise an interview it conducted with Dierk Paskert in the following manner: ‘Businesses are worried about free access to oil, gas and minerals. The head of the Commodity Alliance [...] demands support from the German government – and, if necessary, the help of the military’ (Handelsblatt, 18 February 2013).
Paskert’s comments caused quite a stir, and the Commodity Alliance was forced to issue a denial: ‘Military conflict is not a suitable means of sustainably securing the supply of raw materials.’ Although Paskert did not directly call for the implementation of a gunboat policy to maintain ‘resource security’, certain statements clearly point in this direction: ‘We need a strategic foreign trade and security policy [...] Therefore, together with our partners in the EU and in NATO, we will have to take on even more responsibility in foreign trade and security issues to achieve this goal’ (Handelsblatt, 18 February 2013).
A similar approach has long been part of Germany’s official military doctrine. The 1992 Defence Policy Guidelines, which set out the tasks of the Bundeswehr, include ‘preserving free world trade and securing unrestricted access to markets and raw materials throughout the world’.6 In addition, a recent White Paper lists ‘a secure supply of raw materials and energy’ as one of Germany’s strategic priorities (Bundesministerium der Verteidigung, 2016:47).
The German government takes action
The German government listened to the signals that these companies were sending out and acted on them. In October 2010, Rainer Brüderle (FDP), then minister for economic affairs, announced that ‘Since early summer, the Federal Ministry of Economic Affairs and Technology has been involved in extensive discussions as part of several working groups that include representatives of the BDI, the raw materials processing industry, the recycling industry and trade unions. The working groups’ findings have been included as part of this raw materials strategy.’ Brüderle also emphasised that the government’s package set out ‘the further path towards a sustainable supply of raw materials in Germany’.7 He was convinced that the strategy would provide industry with the protection it was demanding. Moreover, Brüderle claimed that the strategy meant that ‘we are facing up to new global challenges, in particular the growing international competition for important industrial raw materials’.8 He announced investment guarantees, the inclusion of commodity projects during the promotion of foreign trade, the creation of a raw materials agency and raw material partnerships with resource-rich countries. Importantly, these partnerships shape the ‘economic and political framework’9 that provides the foundation access to platinum and other minerals. In addition, Brüderle argued that they provide ‘important support to German industry’s capacity to access a secure supply of raw materials’.10
Germany is not particularly selective when it comes to finding partners for cooperation – and this is particularly the case whenever Berlin heeds the ‘call of gold’. In 2013, Günter Nooke, Chancellor Angela Merkel’s personal Africa representative, stated: ‘The demand for responsible, non-corrupt governments remains central to all forms of development and any meaningful use of a country’s resources. However, it would be naïve to demand that raw materials should not be extracted if certain political, legal and administrative conditions are not met. That is not the way that the world works, especially not in Africa.’ Nooke was speaking at an event jointly organised by the Konrad Adenauer Foundation and the Sub-Saharan Africa Initiative of German Business (SAFRI) (Wahlers, 2013:11). He concluded by stating, ‘Political experience demonstrates that, in the end, it is not WTO rules that govern the game, but power interests’ (Wahlers, 2013:11–10).
The German Mineral Resources Agency (DERA) plays a key role in Germany’s raw materials strategy. DERA describes itself as ‘the economic competence centre for raw materials and the central information and advisory platform for mineral and energy resources for German businesses’.11 DERA, which is attached to the Federal Institute for Geosciences and Natural Resources (BGR), tracks international commodity markets, carries out risk analyses and conducts research into the potentials of raw materials. The agency prides itself on having a ‘sound regional knowledge of raw materials and economics’, and in particular good relations with developing countries. It works with countries such as Mongolia, Kazakhstan, Chile, Peru and South Africa and implements projects to explore and extract raw materials in these countries. It also prepares studies, such as Sicherung der Rohstoffversorgung bei der BASF im Allgemeinen und im Falle der seltenen Erden (On the possibilities of engagement of German companies in the South African raw materials sector),12 that provide the basis for new raw materials partnerships. DERA also holds events that provide information about the industry. The trade seminar ‘Energy and raw materials for tomorrow: Securing raw materials for the German economy’, which was organised in 2012 together with the German Chambers of Industry and Commerce, was also attended by Gunther-Alexander Kellermann, a representative of BASF. Kellermann gave a speech about ‘Securing the supply of raw materials at BASF in general and particularly in the case of rare earths’.13
For some time, the German Chambers of Commerce Abroad has operated ‘competence centres on mining and raw materials’ in countries that are rich in minerals, and German embassies are also active in these areas. The German Chamber of Commerce in Peru has launched a coalition of German companies that includes BASF, VW and Canasta Tecnológica Alemana, and it organises trips to the mines.
Development policy is also expected to play its part. In 2010, the Federal Ministry for Economic Cooperation and Development (BMZ) published the Entwicklungspolitische Strategiepapier Extraktive Rohstoffe (Development Policy Strategy Paper Extractive Raw Materials) and pointed out that action needed to be taken on cobalt, platinum, and tantalum in terms of ‘advice and competence development for modern, efficient and environmentally friendly mining and production methods’ (BMZ, 2010).
Conflicts over conflict minerals
Corporations such as BASF do not merely undertake political activities in order to secure access to raw materials; they also focus their political intervention on what are known as ‘conflict minerals’. Conflict minerals are raw materials that trigger, fuel or at least finance war-like conflicts, and, therefore, come to the attention of supranational organisations and governments. The brisk business that is currently being conducted in conflict minerals has led the United Nations to adopt guiding principles on business and human rights, and the OECD has also issued policies urging companies to exercise a special duty of care in their supply chains. The German government responded with its National Action Plan on Business and Human Rights. In this context, a hearing took place on 1 October 2015 at the Federal Ministry for Economic Cooperation and Development, and representatives of BASF also attended. During the hearing, BASF’s Thorsten Pinkepank pointedly rejected placing excessively high demands on the industry. The minutes of the meeting record him as stating, ‘Businesses cannot be expected to take on the statutory role of protecting human rights. If they do have to adopt this role, they can only be expected to do so to a very limited extent.’14 Pinkepank also argued that transparency was not an end in itself and stressed the importance of ‘maintaining proportionality at all times between the efforts involved, the information gained, and privacy and business secrets’. Furthermore, he was even unhappy about the term ‘human rights’. Pinkepank argued, ‘It is important to remember that whenever the issue of human rights is raised, companies feel like they are under accusation; as such, the term does not have positive connotations.’15 He continued by arguing that the National Action Plan should focus on providing support to corporations and helping them, for example, by providing information and country-specific risk databases. Pinkepank made these comments despite the fact that the corporations are fully aware about what is going on in certain resource-rich countries.
When the governing coalition took Pinkepank’s concerns to heart as part of its December 2016 National Plan, Bread for the World, Amnesty International and other organisations reacted with disappointment. ‘All of them “should” implement human rights diligence processes to prevent human rights violations in their supply chains. This will be “verified” on a random basis. If companies ignore these requirements, however, they will not face any consequences’ (see the chapter by Sarah Lincoln) (VENRO et al., 2017:3).
Despite the fact that the situation had looked quite hopeful for them at first, the corporations were less fortunate at the EU level. The BDI initially praised the plan that Brussels had drawn up to deal with conflict minerals, calling it a ‘balanced proposal’. This should come as no surprise, since the EU had intended to encourage companies to voluntarily comply with the plan and left it up to businesses to certify their own supply chains. However, this was before the European Parliament got involved. The parliament not only improved the Bill, but also put in place rules governing the disclosure of procurement practices. Nevertheless, national authorities were left to assess whether the provisions were being properly implemented.
BASF also uses industry-specific organisations such as the International Platinum Group Metals Association (IPA) to exert further pressure. The IPA quite openly describes itself as an ‘early warning system for the PGM industry that monitors legislative projects (emissions control, REACH,16 recycling, etc.) and industry-related topics such as trade, health and safety, and sustainable development’.17 The last time that IPA president Steve Phiri, head of the South African platinum mining company Royal Bafokeng Platinum, rang the alarm bells was in June 2017. At that time, the South African government had adopted the Mining Charter III as a means of strengthening the position of black people in the extractive industries. Previously, at least 26 per cent of a mining corporation had to be owned by black shareholders; Mining Charter III increased this percentage to at least 30 per cent. In addition, it forces companies to use at least 1 per cent of their turnover to finance black empowerment. This situation led Phiri to label the charter as ‘the last nail in the coffin’ of the mining industry (Vanek, 2017). Moreover, he immediately announced a law suit in his capacity as vice-president of the Chamber of Mines, which includes industry giants such as Glencore and Lonmin. However, it may no longer be necessary for the Chamber of Mines to pursue the case because, when President Jacob Zuma resigned, Mining Minister Mosebenzi Zwane also lost his position – and the mining charter played a considerable role in his replacement.
The IPA considers that part of its work should involve lobbying against REACH – the European regulation that regulates chemicals. It believes that REACH poses a threat to the mining industry, and for good reason: Brussels requires assessments to be undertaken of the health risks associated with the processing of certain substances, including platinum. Although platinum is not linked to any direct health risks, its salts can cause cancer, damage organs, cause genetic mutations and increase the toxicity of other substances.
BASF has not only used IPA lobbying to ensure that the REACH requirements are set as low as possible; it also lobbies to hinder their implementation. This has been achieved at the European level through the merger of the European Chemical Industry Council (CEFIC) and Business Europe, and at the German federal level through the Chemical Industry Association. However, BASF also took up the initiative itself and sent a member of staff to the EU working group that drew up the REACH directive. Later, this person continued to work with REACH as an ‘external employee’ of the Federal Ministry of Economic Affairs and Technology. Moreover, despite the fact that he was still employed by BASF, he claimed to be representing the Ministry of Economic Affairs during a presentation he gave for MEPs, so as to provide his agenda with the appearance of an official remit.
BASF’s representative in Berlin was soon in a position to report back to Ludwigshafen. The representative’s lobbying led the Ministry of Economic Affairs to water down plans that had been drawn up by the Federal Ministry for the Environment, Nature Conservation and Nuclear Safety to use REACH to implement far-reaching precautionary measures to protect people’s health. The former secretary of state for the environment, Rainer Baak, was angered when he learned of the details. Speaking on the ARD programme Monitor (3 April 2008), Baak stated, ‘If it is true that a salaried BASF employee was involved in drawing up European legislation with the Ministry of Economic Affairs on chemicals law, it is scandalous. This would mean that some people in the Ministry of Economic Affairs do not understand that they are committed to neutrality and that they are not there to represent the interests of individual companies in Germany.’
It is unlikely that BASF, which has also installed its emissaries in the German government’s press service, the Ministry of Finance and the Ministry of the Environment, believes that it has crossed a red line. On its website, the company argues, ‘BASF supports personnel transfers and temporary personnel exchanges between BASF and political organisations and institutions or the public administration. The aim is to gain knowledge and experience from different working environments and thus an improved understanding of the specific political and business contexts, structures and processes involved.’18
Extreme corporate lobbying such as this has succeeded in drastically reducing the number of substances that have to be assessed as part of the REACH directive. Moreover, these companies now only have to submit detailed data sets on substances with an annual level of production that exceeds ten tonnes. And they have plenty of time to do so – even though it was adopted 12 years ago, the REACH directive has yet to be fully implemented. The transitional period for full registration for substances with an output of between one and a hundred tonnes per annum, however, expires in June 2018.
As a major emitter of climate-damaging carbon dioxide – BASF produced around 22 million tonnes in 2016 – the corporation has successfully lobbied the German government to ensure that its emissions do not get the corporation into trouble. Moreover, in cooperation with other multinationals and associations such as CropLife, the European Roundtable of Industrialists, Business Europe and CEFIC, BASF succeeded in making the EU emissions trading system largely ineffective. The programme was launched in 2006, but has never achieved its goal of ensuring that economics has a positive impact on the environment. The concept of charging companies for every tonne of greenhouse gas that they emit above the limit has so far failed to influence their actions. This is because industry persuaded Brussels to set the emissions limits too generously. In addition, companies were granted numerous licences to emit CO2 free of charge and did not even have to register all of their plants with the EU Emissions Trading System (ETS).
This has resulted in regular attempts by the EU to reform emissions trading; however, as global players immediately intervene whenever they do so, the reforms have only ever resulted in minor fixes. In 2014, BASF and 13 other companies even approached the European Commission president, José Manuel Barroso, about this issue. Bock and colleagues argued that ‘the ETS should continue without changes until 2020’.19 The company directors even threatened to relocate their production facilities if changes were made. Moreover, Bock also rejected the EU’s target of reducing carbon dioxide emissions by 40 per cent by 2030, compared with 1990 levels. In 2014, Bock warned that ‘if we take the 2030 climate targets seriously, European industry – and chemistry – will have to shrink’.20 Moreover, BASF has also provided generous campaign donations to Republican climate change deniers in the United States. In fact, the corporation’s ‘commitment’ to these issues earned BASF the dubious title of being one of the most effective lobbyists when it comes to preventing climate change policies: BASF was ranked sixth in this context by InfluenceMap (taz, 12 September 2017).
BASF also extensively uses its channels of influence in the field of genetic engineering. For example, the corporation wrote a letter to DEFRA, the United Kingdom’s environment ministry, to argue that new techniques such as oligonucleotide-directed mutagenesis (OgM) should not be treated as genetic engineering. BASF was trying to ensure that OgM – a procedure for changing the genetic material in plants by activating the repair mechanism within their cells – would not have to undergo a lengthy approval procedure. In general, BASF is committed to simplifying the approval of genetically modified (GM) crops through EuropaBio and other organisations. Even in the case of laboratory-grown crops that enter EU soil illegally and that may infiltrate the DNA of conventionally bred species, the corporations urged Brussels not to fall back into its ‘fortress Europe’ mode and instead called on them to welcome them to Europe.
BASF was particularly persistent in its lobbying when attempting to pave the way for the introduction of Amflora – its GM potato. The company wrote nine letters to the European Commission president, José Manuel Barroso, and the environment commissioner, Stavros Dimas. Moreover, because BASF was unhappy with the speed of the process, the corporation even sued the European Commission for inaction. It also threatened Berlin and Brussels by promising to shift its research activities to more ‘innovation friendly’ countries if the potato – with its artificially high starch content – were not to receive approval.
BASF not only influences European Union policies from the outside; it is also well connected within the EU’s political structures. For example, the Advisory Forum of the European Food Safety Authority (EFSA), which conducted the scientific assessment of Amflora, included many faces that were familiar to BASF.21 Joe Perry, for example, had a long history of working for a company that received research contracts from the corporation. In addition, Howard Davies was employed by the Scottish Crop Research Institute, which also received orders from BASF. Moreover, BASF even directly contracted Jeremy Sweet to produce a study for the company. Finally, Detlef Bartsch wrote an article for the journal Nature Biotechnology together with colleagues from the corporation; Bartsch also belongs to the Society for Plant Breeding, which was cofounded by BASF.
Unsurprisingly, in 2009, the EFSA approved Amflora. The panel argued that resistance to the antibiotics neomycin and kanamycin, which BASF researchers had incorporated as markers into the potato to control successful gene transfer, posed no risk to health. At the same time, the EFSA did not seem to be worried about the fact that these genes could spread into the environment and promote the development of pathogens that are immune to neomycin and kanamycin because, it claimed, these two substances have ‘little or no therapeutic relevance’. The World Health Organization sees this very differently and classifies neomycin and kanamycin as ‘critically important antibacterial agents for human medicine’.22
This situation led a number of EU member states to take court action against the approval of Amflora – and they won the case. In December 2013, the European Court of Justice revoked Amflora’s approval, citing errors in the approval procedure.
As if that were not enough, BASF also lobbies Brussels to ensure that the EU does not impose stricter controls on pesticides and hormonally active substances. The corporation also focuses on the EU’s research, chemicals, health and trade policies (such as TTIP) and pulls the strings from its office for ‘EU–Government Relations’ in rue Marie de Bourgogne in Brussels. However, although its lobbying headquarters has just 19 employees, it swallows up 3.2 million euro a year. Ten members of staff have access to the European Parliament and some even sit on EU working groups, such as on occupational safety. Furthermore, BASF sends out its own invitations to events such as parliamentary evenings, dinners and dialogue events in the Belgian capital and the corporation also maintains further ‘liaison offices’ in Berlin, Washington, New Delhi and Beijing.
A review of corporate lobbying
BASF does not sit on its laurels; it assesses the influence it has and uses every trick in the book to ensure that its interests are represented. In the course of setting up its office in Berlin, BASF commissioned a ‘government relations study’ to find out how its lobbying policy could be made as successful as possible in the German capital. In 2000, as part of the study, the corporation interviewed over 200 members of the German parliament, around 100 members of parliamentary staff, 50 representatives of the press and about 1,000 people from Berlin. The corporation was interested not only in the general level of acceptance of lobbying, but also in identifying the acceptance of lobbying in specific situations, such as during legislative processes. The corporation sought to understand politicians’ preferred manner of dealing with corporations by asking for information about the importance that the politicians placed on contacts with board members, experts from specialist departments and liaison officers. In addition, BASF also enquired as to whether the politicians would like to visit production sites or needed further information about the corporation.
BASF is very open about the results of its study. The former chair of ‘Young Union’ (Leif and Speth, 2003:98–114), Klaus Escher, who led the liaison office from 2000 to 2002, presents the findings in his contribution to Die stille Macht. Lobbyismus in Deutschland (The Silent Power: Lobbyism in Germany).23 Escher is happy to state, ‘The overwhelming majority of respondents from politics and the media view corporate participation in political debates as desirable or essential.’ In contrast, although the general population accepts lobbying or the ‘participation of companies in political debates’, it is ‘much more sceptical about it than the political or media elite’ (Leif and Speth, 2003:102–104). The latter take a more positive view of lobbying by BASF and others, with 71 per cent attesting to a strong or very strong corporate influence on politics and 89 per cent considering this to be the case with industry associations.
Escher draws a number of conclusions from the study: a company’s political office should not simply be involved in public relations; rather, it should ensure that corporate strategies ‘are translated into economic policy interests’ (Leif and Speth, 2003:112). Clearly, this is best done within familiar circles that do not leak information to the outside world – groups such as the Tuesday Circle. This group, which now operates under the name Collegium, includes representatives of large national and international corporations. They regularly invite high-ranking politicians and officials to their meetings, who clearly make for an attentive audience. A former TUI lobbyist described the exclusive club in the following terms: ‘The Collegium is a form of focused lobbying power that no minister or secretary of state can ignore.’24 In 2012, the Collegium was chaired by the head of BASF’s liaison office in Berlin.
Escher also recommends deploying the extra weight provided by terms such as ‘investment’ and ‘innovation’ in meetings with members of parliament. However, he maintains that points can also be scored with other topics that are ‘derived from internal fields of competence’ such as the world economy or taxes. Escher, speaking from his own experience, points out, ‘This is what happens when BASF’s tax experts meet with important financial politicians’ (Leif and Speth, 2003:113) He also speaks with pride about the visit to BASF that was conducted by the Bundestag’s inquiry into the effects of globalisation. Once again, he sees no reason for modesty and shamelessly reveals how the company moulds the political landscape.
The work that BASF undertakes to ensure that it wields influence at the political level displays a remarkable level of continuity across time and political systems. The corporation has always sought the proximity of the powerful – whoever they have been – in order to enforce its economic agenda. It is certainly not worried about mixing with the powerful and is as at home with dictators as democrats. It seems that BASF has something to offer every taste. It was even ready to supply the products needed when past rulers lusted after war.
The corporation does not even shy away from directly entering into politics. It greatly helped pave Helmut Kohl’s road to power. At the same time, if necessary, BASF’s employees change sides and adopt important political positions: on the corporate march through the political institutions, BASF’s emissaries have taken up posts within ministries and governments. Clearly, the state’s constitutional foundation does not provide for the power of industrial players, and industry has no political mandate. Therefore, corporations use informal channels that deal with public affairs within networks that lack any form of transparency. However, it is for good reason that the lobbyists do not attempt to gain a political mandate. It would be difficult for them to do so because they represent highly particular interests. Furthermore, in the case of BASF, these interests are often explicitly directed against the common good, such as whenever the corporation demands fewer climate protection measures, less regulation of hazardous substances or the unhesitant deployment of risky technologies. As Günter Grass once said, it is practices such as political landscape management that lead ‘democratically elected parliaments to degenerate into the playgrounds of economic interests’ (Neue Westfälische, 14 April 2015). Lobbyism clearly represents something of a blind spot in terms of parliamentary democracy.
Notes
1 Saltpetre is indispensable for explosives production. When the British naval blockade prevented Germany from importing saltpetre from Chile, German industry jumped at the chance to fill the gap: BASF boss Carl Bosch and his Bayer counterpart Carl Duisberg gave the Supreme Command the ‘Saltpetre Promise’. In return for the commitment to further develop the Haber-Bosch Process, which offered an alternative method of large-scale nitric acid production, BASF received generous subsidies, purchase guarantees and interest-free loans.
2 The Flick party sponsoring affair was one of the largest corruption scandals of post-World War II Germany.
3 See https://www.presseportal.de/pm/6570/654117
4 See www.german-foreign-policy.com/news/detail/1219/.
5 See Rohstoffsicherheit. Herausforderung für die Entwicklungspolitik, www.kas.de/wf/de/33.12174/.
6 See Deutschlands Beteiligung am weltweiten Krieg um Ressourcen, 16 January 2007, www.ippnw.de/frieden/energie-krieg-frieden/artikel/de/deutschlands-beteiligung-am-weltweit.html.
7 Bundesregierung bringt neue Rohstoffstrategie auf den Weg, 20 October 2010, https://www.pressebox.de/pressemitteilung/bundesministerium-fuer-wirtschaft-und-technologie-bmwi/Bundesregierung-bringt-neue-Rohstoffstrategie-auf-den-Weg/boxid/382841
8 Ibid.
9 BMWi, Rohstoffpolitik, www.bmwi.de/Redaktion/DE/Artikel/Industrie/rohstoffpolitik.html.
10 Ibid.
11 Rohstoffe Subsahara, p 6, https://www.bgr.bund.de/DERA/DE/Downloads/rohstoffstudie-subsahara.pdf
12 Answer by the Federal Government to a minor inquiry posed by Bündnis 90/Die Grünen, Drucksache 17/13434, 10 May 2013, p. 5, http://dip21.bundestag.de/dip21/btd/17/134/1713434.pdf
13 See www.bit.ly/2CkZK5L.
14 See Dokumentation Nationaler Aktionsplan Wirtschaft und Menschenrechte, 3 November 2015, www.auswaertiges-amt.de/blob/273846/65c4e91657273906cba5c7b6348e6d6f/expertenanhoerung8-data.pdf.
15 Ibid.
16 The European Chemicals Regulation REACH is a directive that governs the assessment of health hazards linked to chemicals.
17 See ipa-news.com.
18 BASF: Regeln für die politische Interessenvertretung, www.on.basf.com/2CntoYj.
19 InfluenceMap, Corporate Carbon Policy Footprint, www.influencemap.org/score/BASF-Q11-D6.
20 Ibid.
21 Approving the GM potato: Conflicts of interest, flawed science and fierce lobbying, 7 November 2011, www.bit.ly/2EzFi7d.
22 Commission Decision of 2 March 2010 authorising the placing on the market of feed produced from the genetically modified potato, document 32010D0136.
23 Joint youth organisation of CDU and CSU, two German political parties.
24 See www.lobbypedia.de/wiki/Das_Collegium.
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