14 June 2012 -- The report ‘Worldwide Investments in Cluster Munitions: A Shared Responsibility’, by Cluster Munition Coalition members IKV Pax Christi and FairFin, identifies 137 financial institutions worldwide that have invested more than $43 billion in producers of cluster munitions since 2009.
The report shows that nine UK-based financial institutions, including Barclays, Aberdeen Investment Management, and Invesco, continue to hold major investments in companies that produce cluster munitions. Thanks to pressure from UK campaigners, several of the worst offenders identified in 2011, including the Royal Bank of Scotland (RBS) and Lloyds, have recently introduced policies banning a range of investments in cluster bomb producers. However, no UK institution has so far done enough to qualify for the report’s ‘Hall of Fame’ listing institutions that have ended all investments in cluster munitions producers.
“Allowing UK banks to invest in cluster bomb producers is comparable to producing these illegal weapons ourselves. This is against the spirit of the Convention on Cluster Munitions which prohibits any form of assistance in the production of these weapons”, said Beatrice Cami, spokesperson for Handicap International UK.
The Convention on Cluster Munitions entered into force in August 2010, making it illegal for State signatories, including the UK, to use, produce, stockpile, or transfer cluster munitions, or to assist any other party to engage in these activities. Handicap International believes that financial investment in the production of cluster munitions is a form of assistance, and is calling on States to ban all investments in the production and trade of cluster munitions.
In 2009, the UK government stated its intention to put a stop to all investments in cluster munitions, reserving the right to legislate further if necessary. However, the Foreign Office now sees indirect investments as a matter for individual institutions to consider under their own investment charters. The government has appeared unwilling to clearly state its support for the work of banks and NGOs towards ending these lethal investments. Campaigners are now questioning the UK’s commitment to tackling the issue.
“However cluster bombs are funded, their impact is the same: they kill and maim innocent men, women and children, with civilians representing a staggering 98% of recorded casualties. Direct investment in cluster bomb production is already illegal under UK law, so how is it acceptable to hold shares in companies that produce these vicious weapons?”, said Beatrice Cami.
Millions of unexploded cluster bombs are still on the ground, claiming the lives and limbs of civilians and devastating communities in some of the poorest countries in the world. Every day, Handicap International teams on the ground in countries like Lebanon and Afghanistan witness the terrible impact of these weapons, and meet victims who are often unable to access the support they need to rebuild their lives.
“Through its silence on cluster bomb investments, the UK government is in danger of failing in its commitment to the victims of these inhumane weapons, despite the progress made in other areas. Our campaigners are calling on the Foreign Office to issue a statement supporting the positive steps taken by some UK banks to disinvest and encouraging more institutions to follow suit”, said Beatrice Cami.
Some countries, including Belgium, Ireland, Italy, Luxembourg and New Zealand, have taken the lead by passing national legislation banning investments in cluster munitions. Many leading banks are also changing their policies to reflect the growing international rejection of cluster munitions. The UK government appears increasingly out of step with moves to end all forms of financing of cluster munitions.
“Most of the world has banned cluster bombs because of the severe and long-lasting impact they have, but even some countries that have joined the Convention are still allowing money to be invested in their production. The only way to prevent this is to explicitly legislate against it,” said Laura Cheeseman, Director of the Cluster Munition Coalition.