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Greenpeace Loses £3M On Foreign Exchange Bet!

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http://www.theguardian.com/environment/2014/jun/23/greenpeace-losses-financial-disarray

The handling of Greenpeace International’s £58m budget has been in disarray for years, with its finance team beset by personnel problems and a lack of rigorous processes, leading to errors, substandard work and a souring of relationships between its Amsterdam HQ and offices around the world, documents and emails leaked to the Guardian show.

The revelations, which come after it emerged that a staffer lost £3m on the foreign exchange market betting mistakenly on a weak Euro, reveal the group’s finance department has faced a series of problems, and that its board is troubled at the lack of controls and lapses that allowed one person to lose so much money.

Greenpeace, which prides itself on being largely funded by relatively small individual donations, apologised to supporters for the loss, claiming the “serious error of judgment” was a result of a single staff member “acting beyond the limits of their authority and without following proper procedures”. But the documents show that internally the group is worried about the organisational failings that allowed it to happen.

Minutes of a board meeting in the spring this year say: “The board takes this [the £3m loss] very seriously and is deeply concerned that there should be such financial loss at a time of transition – when reserves are stretched and income is substantially lower than projected, and it is particularly troubled by how it happened, ie the lack of strong, coherent processes and controls that prevent the possibility that contracts can be entered into without due authorisation.”..

..

The Guardian has also learned that one of the group’s most senior executives, Pascal Husting, Greenpeace International’s international programme director, works in Amsterdam but flies between the city’s offices and his home in Luxembourg several times a month.

..

Mike Townsley, the group’s head of communications, told AP last week of the £3m loss that “hindsight is 20/20, but we believe if he [the individual who made the transactions] had followed rules and procedures this wouldn’t have happened.”

However, a strategy document dated November 2013 shows that problems appear to extend well beyond one individual and that Greenpeace International’s senior executive team was aware of widespread problems in its finance department that date back years.

I'm guessing that the individual who made the decision is still in post?

Great to see one of the execs doing his utmost for the environment with keeping his flying to a bar minimum!

If only they'd have bet on London property, they'd have made a fortune.

Although I have no idea why Greenpeace should be betting on the foreign exchange markets

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Just think - 15 years ago this would NEVER have been known. The internet is truely creating democracy.

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I'm not sure this is entirely fair. Businesses need certainty above all else. They need to know what their outgoings and income will be. Because of this they use banks to hedge their interest rate risk. This story suggests greenpeace lost $3m which is like saying you lost your home insurance monthly payments because your house didn't burn down. Had the Euro rate gone down they would have been protected.

Its a non-story for people who aren't faced with these decisions in their daily lives.

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Greenpeace International’s international programme director, works in Amsterdam but flies between the city’s offices and his home in Luxembourg several times a month

How very 'green' of him. Has he not heard of e-mail?

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Seems to me these Ethical Institutions can't resist a go on the Casino. Most memorable was the Church of England who cashed out its chips in equities after the stock market crash of 87 and then put them into property in 89. Finally got to lose the booty it had pillaged over the previous centuries...but they still have a fall back on Chancel Repair to steal some back off the plebs.

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I'm not sure this is entirely fair. Businesses need certainty above all else. They need to know what their outgoings and income will be. Because of this they use banks to hedge their interest rate risk. This story suggests greenpeace lost $3m which is like saying you lost your home insurance monthly payments because your house didn't burn down. Had the Euro rate gone down they would have been protected.

Its a non-story for people who aren't faced with these decisions in their daily lives.

Indeed. The company I work for will pay for a hedge when we receive a large order in a foreign currency. Assuming greenpeace is funded via donations from countries all over the world it doesn't strike me as particularly odd (although I'd be interested in seeing exactly what they stood to gain if the hedge had went their way).

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