According to some financial institutions, nuclear weapons are not controversial

The Belgian bank KBC claims to have “the most far-reaching policy on controversial weapons in the world.“ Recently however, the report ‘Don’t Bank on the Bomb‘  by the International Campaign to Abolish Nuclear Weapons (ICAN ) and IKV Pax Christi showed KBC investments in Serco, a company involved in development and maintenance of nuclear weapon technology.  When questioned about this, the stunning reaction of KBC was that “Nuclear weapons are legally not recognized as controversial arms. We abide to that.” This led to angry reactions from for example the Belgian trade union BBTK.

It is a mystery how KBC reaches the idea that ”controversial’ is some sort of juridical category. A controversial weapon is a weapon that is so abhorrent that most people wish it did not exist. While the debate on whether nuclear weapons are illegal is still ongoing, it is hard to understand how one can even think of definining them as not controversial. They are weapons of mass destruction. If used, they will be deadly for civilians and soldiers non-distinctively, , and their effects can’t be limited in time or in geographical sense. Which, by the way, were the major reasons to declare landmines and cluster ammunition illegal weapons. Nuclear weapons have the potential of completely destroying humanity and the whole planet. Last March the International Red Cross warned that there is no effective way of delivering humanitarian assistance to victims of a nuclear blast. How can such a weapon be called non-controversial?



Yet, ABP, the largest Dutch pension fund and also one of the largest pension funds in the world, has been following the same policy as KBC for years. It says it wants to invest in a responsible manner, but its whole responsible investment policy comes down to merely adhering to the law, whch one might expect from them anyway. Apparently, ABP completely denies its own responsibility in ethical matters. ABP does not invest in companies involved in the production of anti-personnel mines, cluster munitions and biological and chemical weapons. However, it sees no problem in investing in nuclear weapons: “Nuclear weapons cause a lot of discussion. One will find the presence of nuclear weapons conducive to peace, the other will want to eliminate them. That is why ABP needed an objective framework to assess in which companies the pension fund does and does not want to invest. The fund is following the line of the Dutch government. Many governments see nuclear weapons as a necessary evil. The Netherlands is party to the Non-Proliferation Treaty (1968) that aims for nuclear disarmament. This Convention provides that only the five permanent members of the Security Council are allowed to have nuclear weapons. The Netherlands recognizes that the possession of nuclear weapons by these countries is legitimate. And with that the production and maintenance of these weapons is legal.”
Based on this reasoning, ABP invests hundreds of millions of euros in nuclear weapons companies, and its investment in those companies is growing.

Fortunately, these institutions are exceptions to the majority of financial institutions with a true responsible investment policy. Only a few more investors, such as Danish pension fund ATP and the small Dutch pension fund PGB follow the same kind of extraordinary reasoning as KBC and ABP. The ‘Don’t Bank on the Bomb‘-report identifies the many positive examples of financial institutions which realise that nuclear weapons are highly controversial and thus should not be considered a investment opportunity.
More public pressure is needed to convince laggards like ABP and KBC that their policy of investment in nuclear weapons is absolutely unsustainable.

[MA, 7 November 2013]