(Bloomberg) -- The head of sustainable investing at Nordea Bank AB’s asset management unit says it’s too soon to forgive Facebook Inc.
Since revelations that the social media giant failed to protect customer data from predatory third parties, the news cycle has moved on. Facebook shares soared after it reported a 49 percent jump in first-quarter revenue last week and as it unveiled a string of new services including a dating feature.
But Nordea’s ethical investing arm says it will keep Facebook on a blacklist, meaning portfolio managers can’t buy it.
“It’s quite obvious that, after two weeks of writing about this, the world goes on and people aren’t focusing on it anymore,” Sasja Beslik, who’s based in Stockholm, said by phone on Wednesday. “But the problem remains.”
Beslik says investors tend to underestimate the power of ethical issues to affect asset s in the longer term. He also questioned the level of transparency and regulatory oversight in the social media industry, especially given the intensely personal nature of the assets being overseen.
In an effort to address concerns about privacy and data collection, Facebook says it’s working on a "clear history" tool that will give users the option of scrubbing their accounts of data sent to the social network via outside websites and apps. The Menlo Park, California-based company said the feature, which will take several months to build, is a response to feedback showing that users want more control over their personal information.
Beslik said the industry remains tainted by a “lack of transparency and a lack of risk-management systems.” He also signaled dismay at the fact that Facebook is spending time on a dating feature before the company has addressed its data privacy issues.
“Maybe in 10 years time, people will learn to their own integrity and the protection of their own integrity,” Beslik said. “That will become the asset. It is becoming the asset. Your personal integrity, your photos, your contacts, your networks, all of these things. Eventually they don’t belong to you anymore. They belong to someone else.”
Beslik has in the past gone so far as to ban his sustainable funds from buying shares in the bank that owns them, amid a tax avoidance probe. The Nordea unit has 6 billion euros ($7.2 billion) in assets under management. Nordea had a total of 320 billion euros in assets under management at the end of March, according to its first-quarter results. Only 0.06 percent of total holdings in Nordea’s sustainable funds are currently in Facebook, Beslik said.
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