TotalEnergies Suspends Further Investment in Adani Group Amid Corruption Investigation

TotalEnergies, one of the world’s largest energy companies, has announced it will cease making new financial contributions to its investments in the Adani Group amid mounting allegations of corruption against some executives from the Indian conglomerate. The move comes after public announcements made by U.S. authorities about the indictment of several Adani Group executives in connection with an alleged bribery scheme linked to Adani Green Energy Limited (AGEL), a key entity within the Adani Group involved in renewable energy.

In a statement issued by the French oil and gas giant, TotalEnergies clarified that it was not implicated in the corruption allegations nor was it directly involved in the facts described in the indictment. The company, which owns a 19.75% minority stake in AGEL and a 50% interest in joint ventures with AGEL, emphasized its commitment to upholding ethical business practices and adhering to its internal code of conduct. TotalEnergies reiterated its strong stance against corruption in any form and vowed to protect its interests as a stakeholder in AGEL and its affiliated projects.

The allegations against the Adani executives relate to an alleged bribery scheme concerning the operations of AGEL, which produces solar energy and other renewable power sources. The U.S. Department of Justice has made public its indictment of certain Adani executives, though it clarified that the allegations do not extend to AGEL itself. Despite this, TotalEnergies has opted to suspend any new investments in Adani Group companies until the full scope of the investigation is clarified and the accusations are resolved.

TotalEnergies’ investment in Adani Group’s renewable energy assets is substantial. As of September 2023, TotalEnergies has committed around $3.2 billion across various joint ventures and stakes, most notably in AGEL, which it entered in January 2021 with a significant minority stake. The French company also holds a 50% share in three major joint ventures with Adani, including AGEL23, AREL9, and AREL64. These ventures focus on the development of solar and other renewable energy projects across India, contributing to the country’s transition to clean energy.

The decision to halt further investments comes as TotalEnergies seeks to ensure that its financial and reputational interests are safeguarded while the investigation into the Adani Group executives continues. The company stated that it was unaware of any ongoing investigation or potential legal challenges when it made the decision to invest in the Adani Group. The French energy giant also clarified that its investments in the group were made in full compliance with local laws, its internal governance processes, and due diligence procedures. TotalEnergies indicated that it had received assurances from the sellers regarding the legitimacy of the Adani Group’s operations at the time of the investments.

The suspension of future investments is a significant move for TotalEnergies, which has been heavily involved in renewable energy projects worldwide, as part of its broader strategy to transition towards greener, more sustainable energy sources. TotalEnergies has been working closely with Adani Group to develop large-scale solar and wind energy projects in India, which is a rapidly growing market for renewable energy. However, the corruption allegations could impact the company’s long-term partnership with Adani, especially as global scrutiny on corporate governance and ethical business practices intensifies.

As the situation unfolds, TotalEnergies has vowed to take all necessary actions to protect its interests, both as a minority shareholder in AGEL and as a joint-venture partner in renewable projects with Adani. While the company has suspended new investments, it did not specify whether it would seek to divest or alter its current holdings in Adani entities but made it clear that it will closely monitor developments and review its strategy accordingly.

This move also highlights the growing risks for international companies partnering with Indian conglomerates, particularly in sectors like energy, where transparency, ethical governance, and regulatory compliance are under increasing scrutiny. TotalEnergies’ decision to freeze further investments until the legal situation is clarified will be a closely watched development in the corporate world, as it may set a precedent for other global investors engaged with the Adani Group.

TotalEnergies remains committed to supporting the global transition to renewable energy and will continue to evaluate the situation with Adani as part of its broader strategy to lead in clean energy. However, the ongoing investigation into corruption within the Adani Group could reshape the future of these partnerships and may have broader implications for international investment in India’s renewable energy sector.