Nordea 'pulls brake' on Facebook investments after data row

Nordea bank unliked (at least temporarily) shares in Facebook, telling its investment funds to stop buying stock in the social m
Nordea bank unliked (at least temporarily) shares in Facebook, telling its investment funds to stop buying stock in the social media giant over concerns of misuse of user data

The Nordic region's largest bank Nordea said Wednesday it would not allow its investment funds to buy stocks in Facebook after the social media giant was ensnarled in a major data scandal.

Facebook has in recent days been pounded by criticism at home and abroad over revelations that UK-based firm Cambridge Analytics working for Donald Trump's presidential campaign harvested and misused data on 50 million members.

"We're now pulling the brake because we see that the risks related to governance around may have been severely compromised," Katarina Hammar, head of Nordea's Responsible Investment unit, said in a statement.

Fund managers are not allowed to buy Facebook shares for three months, but they can sell the ones they already hold, the bank said.

"Until we've had time to fully assess the breath and width of this problem, we choose to quarantine the company," Hammar said.

Currently only the Nordea Global Stars fund, which invests in companies it considers are fulfilling human rights, environmental and labour standards, holds shares in Facebook. They account for just under two percent of the total holding,

Facebook said it has hired a digital forensics firm to examine how the data leak occurred and to ensure that any data collected had been destroyed.

A Cambridge Analytica statement denied misusing Facebook data for the Trump campaign.


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© 2018 AFP

Citation: Nordea 'pulls brake' on Facebook investments after data row (2018, March 21) retrieved 23 April 2019 from https://phys.org/news/2018-03-nordea-facebook-investments-row.html
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