Veolia’s Corporate Structure and Control: a Single Entity
(updated 8th July 2013; 13th June 2014)
1. Corporate Structure
Veolia Environnement (VE) is the Paris-based parent company.
Veolia Environmental Services UK (VES UK) is a wholly owned subsidiary of VE.
Veolia Environmental Services Israel (VES Israel) is 99% owned by the Veolia Environmental Services Division of VE (the remaining 1% is owned by E Europeenne compagni).
VES Israel owns 95.9% of TMM Integrated Recycling Services which, together with its subsidiary Y.R.A.V Sherutei Noy 1985, operates the Tovlan landfill site that takes refuse from illegal Israeli settlements in the occupied Jordan valley and from Israel. TMM and Y.R.A.V Sherutei Noy 1985 also transfer waste to Tovlan.
On 3 April 2011 Veolia Transport merged with Transdev to form Veolia Transdev. Veolia Transdev is 50% owned by VE, so VE still bears very substantial responsibility for Transdev’s wholly owned subsidiary Veolia transport Israel. In its reporting VE treats Veolia Transdev’s operations as its own. In 2013 Veolia Transdev was renamed Transdev.
Veolia Transport Israel owns 5% of the CityPass consortium that built the Jerusalem Light Rail Transit (JLR), which as a result of recent construction now services illegal exclusively Jewish Israeli settlements in illegally annexed East Jerusalem. Connex Jerusalem Light Rail operates the JLR. Veolia Transport Israel owns 100% of Connex Jerusalem Light Rail and therefore has control of the operation of the JLR.
There is ample evidence from the company’s management practice that Veolia is one commercial entity and that Veolia Environnement has effective control of its subsidiaries and requires them to follow its instructions.
In 2005 Veolia Environnement’s four divisions adopted a single name, Veolia, and a new logo. As the Veolia website stated, this move ‘signalled the desire of the entire company to link Veolia divisions in a coherent way and increase its visibility’. (In 2013 Veolia changed the designation of its divisions to businesses). By the end of 2010 Veolia had revenues of £30 billion and employed around 317,000 people. Veolia’s revenues and profits are calculated as ‘a whole’, and the corporation is quoted on Euronext Paris and the New York Stock Exchange. Indeed, even when reporting results, Veolia regards its subsidiaries as divisions of itself and, significantly, Veolia regards its subsidiaries’ contracts, including those with British local authorities, as its own. This is clearly illustrated in their statement that “The company [Veolia Environnement] won and renewed multiple contracts in its priority development zones, including: … Shropshire in the UK in the Environmental Services (Waste Management) division.”
Further evidence that Veolia is one commercial entity is provided by a letter from Veolia Environmental Services (UK), which refers to “ascertaining the status of our involvement with the Jerusalem Light Railway. All of your comments have been passed to the relevant departments within our company for their consideration.” From the comments a few lines later it is clear that “relevant departments” included the Paris Head office, i.e. the head office of the parent company. The letter goes on to refer to “our colleagues who are more closely linked to this project.” It is abundantly clear from this that for Veolia Environmental Services (UK) ‘our company’ is the entire Veolia group, the Paris office of Veolia Environnement is Veolia Environmental Services (UK)’s Head Office, other Veolia Group companies are departments of Veolia as a whole, and all personnel within the Veolia Group are colleagues of Veolia Environmental Services (UK).
This approach is reflected in Veolia’s employment policies which have shown Veolia’s commitment to allowing staff to move freely among the various divisions of Veolia Environnement, providing further evidence of one corporate entity. An employee’s company service has been based on their start date within the group; international transfers have been written up in an amendment to the employment contract; at the end of an expatriation assignment the original company has made it a priority to find the employee a new assignment in the division; and, whilst on expatriate assignment, career advancement has been monitored in the same way as other Veolia Environnement division employees. As the Veolia website page on internal mobility puts it: “The functional and geographical mobility of employees is a cornerstone of Veolia Environnement’s strategic growth strategy. Our size, large workforce, diverse locations and myriad areas of expertise all present opportunities for Veolia Environnement employees to fulfil their professional and personal development and realize their ambitions.”
Further, Veolia Environnment’s 2008 document “Ethics, Commitment and Responsibility” provides more clear evidence of one commercial entity. The Foreward “Our Corporate Commitment” describes the document as a guide for all our 336,013 employees worldwide, but it is one they must follow and so amounts to instructions. “4.1 Safety and Morale in the Workplace” states “Employees must comply with instructions and procedures issued in these areas by- – – – -Veolia Environnement – – -.” This is an unambiguous indication of the parent company’s control of its subsidiaries’ employees. The “Organisation” section states boldly that “All employees must comply with the Veolia Environnement “Ethics, Commitment and responsibility” programme. The section “Organisation: 1. Programme Scope of Application” states that “The Programme applies to all companies controlled by Veolia Environnement, that is to say all companies in which Veolia Environnement directly or indirectly owns or controls over 50% of the voting rights.” This is a clear statement of the parent company’s control over VES (UK) and Veolia Environmental Services (Israel). “Guiding principles” states “Our Divisions- – – all represent Veolia Environnement”, while “Social Responsibility”, section 3 of “Guiding Principles, includes “offering its employees – – – -long-term local employment”, which indicates that it is Veolia Environnement, the parent company, that is the real employer, even if the employee signs a contract with the local subsidiary. The 2013 Ethics Guide also makes clear that all Veolia employees worldwide must obey its instructions: “OUR RULES OF BEHAVIOUR: Veolia has adopted rules that apply to all employees and at all levels of the company in the performance of their duties.”
It is clear too that the parent company, Veolia Environnement, retains control of its subsidiaries’ investment. On page 59 of the presentation on Veolia Environnement’s Investor Day 2011 (6 December 2011), referring to Veolia as a whole, it states: “All investments above 10 million Euros to be approved by Veolia’s investment committee, depending on strict return criteria.”
Confirmation that Veolia is one commercial entity has recently been provided by Veolia Environmental Services UK itself. On Thursday 24th May 2012, a group of campaigners and Mr Julian Brazier MP, who is concerned about Veolia’s bid for a contract with Canterbury City Council, met Mr Robert Hunt (Veolia Environmental Services UK’s Executive Director Business Development, Projects and External Corporate Affairs) in Mr Brazier’s office in Portcullis House, Westminster. At this meeting Mr Hunt confirmed that Veolia is a single entity. Mr Hunt was absolutely unequivocal in acknowledging that Veolia is a single integrated multi-national company.
It should also be noted that the Veolia Environmental Services UK website describes the company unequivocally as “Part of Veolia Environnement”.
It is evident from the foregoing that Veolia comprises a single entity and profits and prospers as such. VES (UK) is under the control of the parent company VE, which in turn has control of its Israeli subsidiaries that have been committing, and continue to commit, acts of grave misconduct. VE bears responsibility for these acts and as a single entity the whole company, including its subsidiaries, shares this responsibility.
 Veolia claim to have sold or be in the process of selling their interests in Tovlan and JLR. However, no sale has in fact taken place in either case and permission may not be given by the relevant Israeli authorities. If the sale of the JLR interests went ahead, Veolia would still be involved through the technical consultancy. If the Tovlan operating rights sale were to be completed it would be to an illegal Israeli settlement (the sale itself therefore arguably amounting to grave misconduct on its own) and Veolia would still be involved in an advisory role. It would still be transferring refuse to Tovlan through TMM and its other subsidiary YRAV. Any future sales would not alter the fact that Veolia has committed acts of grave misconduct in the course of its business activities.