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“Moving Away from Mass Destruction” a new report by PAX and ICAN shows that 109 financial institutions have published policies avoiding investment in the nuclear weapons industry.
This comprehensive report offers a captivating glimpse into the emerging norm within the financial sector to steer clear of companies associated with existential risks. It also reveals how investors are going beyond simply avoiding the industry to proactively taking extra precautions to eliminate any exposure to the production of inhumane weapons.
The potential regulatory or reputational risks that come with financing the companies involved in the production of nuclear weapons are significant enough that they must be considered material. The Treaty on the Prohibition of Nuclear Weapons (TPNW), which entered into force in January 2021, renders any form of aid, including financial assistance, towards the development and production of nuclear weapons illegal. Additionally, over 80% of EU citizens support laws to hold companies accountable for harm to people and the environment, and agreed that companies should be legally involved not to get involved in human rights violations or environmental crimes anywhere in the world.
As Susi Snyder, one of the contributing authors of the report, reflects: “investing in nuclear weapons is controversial. Whether because of the industry's negative impacts on human rights, or the risk to the environment, or the indiscriminate and inhumane nature of these products, nuclear weapons are a problem and no one should invest in the industry with impunity.”
The number of financial institutions listed in this report has grown steadily, from 35 institutions when the analysis was first conducted in 2014, to the 109 listed today. The entry into force of the Treaty of Nuclear Weapons was followed by the biggest spike in policies, from 77 to over 100. By adopting policies and practices outlined in this report, the financial community is actively endorsing the treaty, as broad stakeholder support is essential for the effective implementation of modern agreements, and helps further strengthen the stigma against these weapons of mass destruction.
“Moving away from mass destruction” includes financial institutions from Aotearoa/ New Zealand, Australia, Austria, Belgium, Canada, Denmark, Finland, France, Germany, Ireland, Italy, Luxembourg, Japan, Malaysia, Mexico, Norway, Spain, Sweden, Switzerland, the Netherlands, the United Kingdom and the United States.
Some of the financial sector policies are very general, excluding any company involved with any controversial weapon. Others specifically take a ‘zero-tolerance’ approach to nuclear weapons or even cite the Treaty on the Prohibition of Nuclear Weapons (TPNW) including:
Crescent Wealth (Australia), Banorte (Mexico), Ethos (Switzerland), NIBC (the Netherlands), KBC Group (Belgium), Degroof Petercam Asset Management (Belgium), PenSam (Denmark), SEB (Sweden), Standard Chartered (United Kingdom), Storebrand Group (Norway), and Länsförsäkringar (Sweden).
Overall, “Moving Away from Mass Destruction” showcases the leaders in the financial community that are paving the way for a world free of nuclear weapons and makes the case why other financial institutions and other institutional investors should follow their lead to enact policies to manage and mitigate these risks.
Read the full report here
Read more about Material and Reputational Risk
Read more about creating your own controversial weapons policy