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Analysis: Rethinking Terror Lists

Council on Foreign Relations

July 2, 2007
Prepared by: Lee Hudson Teslik

Terror lists are very much in vogue. Long the province of the U.S. State Department, which annually releases its Country Reports on Terrorism, the business of indexing terror organizations and “sponsor” states has diversified, with assorted think tanks and for-profit firms releasing their own, sometimes politically-colored rosters (WSJ.com). Now the U.S. Securities and Exchange Commission (SEC) adds its brush to this canvas, crafting a blacklist of companies that report dealings with “state sponsors” of terrorism in their annual filings to the commission. SEC Chairman Christopher Cox says the project aims to protect investors from “indirectly subsidizing a terrorist state” (AP). But the list prompts outrage from companies and stirs debate more generally on the wisdom of releasing terror lists, given the potentially radioactive diplomatic consequences they tend to provoke.

The SEC list spotlights a number of major multinational corporations, mostly non-American, including HSBC, Unilever, Cadbury, Nokia, Siemens, and Total. Representatives from the listed companies levy a number of complaints (FT). First, they say, the list makes no effort to specify the extent of a company’s ties to a given country. Nor does it indicate whether ties still exist—only whether a state-sponsor country is listed in the company’s 2006 annual report, which might now be out of date and which would not specify if a company were in the process of divesting from a country.

Read the rest of this article on the cfr.org website.

Copyright 2007 by the Council on Foreign Relations. This material is republished on GlobalSecurity.org with specific permission from the cfr.org. Reprint and republication queries for this article should be directed to cfr.org.