10 controversial projects of 2017

A Switzerland-based risk management company listed the Imperial Pacific Resort and Casino among its Top 10 most controversial projects of 2017.

The March 2018 report from Reprisk included IPR in its Top 10 list of what it termed as the “most controversial” projects of 2017. It described itself as a research and business intelligence provider firm specializing in environmental, social, and governance and business conduct risks.

Ranked at No. 10, the IPR construction joins the likes of the Grenfell Tower in the United Kingdom, China’s Ctrip Day Care Center, Germany and Russia’s Nord Stream 2 Gas Pipeline, South Korea’s Changwon Jinhae Shipyard, and more.

IPR is the only U.S.-located project on the list.

Saipan Tribune attempted to obtain comments from Imperial Pacific International (CNMI) LLC, the mother company of the IPR, but it did not respond.

Reprisk does business with private entities such as Bank of America, Citigroup, Deloitte, Deutsche Bank, Australian Super, Barclays, and more.

The Reprisk report cited poor employment conditions; occupational health and safety issues; human rights abuses and corporate complicity; and supply chain issues as their top environmental, social, and governance issues, also known as ESG issues.

The report noted the Federal Bureau of Investigation’s involvement with IPI, which Reprisk said was “prompted by the death of a worker who fell from a scaffold on a construction site.”

The worker was an employee of an IPR contractor.

“The investigations revealed that the workers, who had been lured by promises of high wages and ‘green card’ that allows the holder to be a permanent U.S. resident, were made to endure 12-hour shifts in the tropical heat,” the report stated. “Some workers claimed that they had been paid less than originally promised, while others claimed that they were owed wages by Sino Great Wall International Engineering,” the report added.

The Reprisk report also stated that two employees of MCC International, a “local affiliate of the Chinese state-owned company China Metallurgical Group Corp., which in turn is a subsidiary of Chine Minmetals Corp.,” was charged with illegally harboring and employing immigrant workers.

The report added that the president and director of Beilida as well as an employee of Marianas Enterprises were also charged.

Philip Aeby, chief executive officer of Reprisk, said the company’s ESG Risk Platform covers over 25,000 projects “that are linked to ESG and business conduct risk incidents. This number increases daily as new risk incidents are captured and analyzed.”

“Four of the projects included in the report were affected by deadly accidents, which posed reputational, compliance, and financial risks for companies concerned,” Aeby wrote in the report’s foreword. “A further two projects were linked to physical abuses, one against children and other against detainees in a detention center. The remaining four projects were linked to issues such as bribery, terrorism, funding, impacts on protected areas, and the illegal transportation of endangered species,” he added.

While the report noted several key points about IPR’s construction, it failed to include in its report that several of the contractors involved with IPI on the construction of the hotel resort reached a settlement with the U.S. Department of Labor, amounting to $13.9 million. The companies involved are MCC International Saipan Ltd. Co., Beilida New Materials System Engineering Co. Ltd., Gold Mantis Construction Decoration, and Sino Great Wall International Engineering Co. LLC.

Also, the report failed to recognize that MCC International is no longer involved with IPI on the construction of the casino.

According to an IPI executive, he previously reported to the Commonwealth Casino Commission that IPI was already discussing a contract agreement with their now main contractor, Guam-based Pacific Rim Constructors. The contract was finalized shortly after his report to the casino commission.

Since then, IPI was able to secure over 1,500 H-2B visas, which is slowly starting to be transported into the CNMI to resume the construction of IPR with the help of Pacific Rim. The same IPI executive reported that most of the approved applicants originated from the Philippines or Taiwan.

Click on https://www.reprisk.com/content/5-publications/1-special-reports/1-most-controversial-projects-of-2017/reprisk-most-controversial-projects-of-2017-report.pdf to view the whole report.