Diversified miner and commodity trader Glencore has established a board committee to oversee the London- and Johannesburg-listed company’s response to US authorities’ demand for documents relating to possible corruption and money laundering.
The committee comprises chairperson Tony Hayward, independent nonexecutive director Leonhard Fischer and independent nonexecutive director Patrice Merrin.
"Glencore takes ethics and compliance seriously throughout the group,” Hayward said on Wednesday, adding that the company would cooperate with the US Department of Justice (DoJ).
Last week, a Glencore subsidiary received a subpoena from the DoJ to produce documents and other records with respect to compliance with the Foreign Corrupt Practices Act and US money laundering statutes. The requested documents relate to the Glencore group's business in Nigeria, the Democratic Republic of Congo and Venezuela from 2007 to present.
The US subpoena sent Glencore’s shares tumbling the most in two years, dropping 8% on the LSE on July 3. The group moved to restore confidence with its July 5 announcement of a $1-billion share buyback, which analyst welcomed.
On Tuesday, the company’s stock fell 4.5% to £3.12 apiece on the LSE. Before the July 3 announcement of the US subpoena, Glencore traded at £3.49 a share.
The company’s share price fell 4.7% on the JSE to R55.51 a share.