Why a treaty banning nuclear weapons rewards ethical investors

October 10, 2013

By Susi Snyder

As the 2013 Don’t Bank on the Bomb report shows, there are at least a dozen financial institutions around the world who have comprehensive policies prohibiting any investment in nuclear weapon producers. There are at least 20 others who have some kind of policy in place, although maybe less comprehensive. One could argue that these financial institutions are preparing now, for a nuclear weapon ban treaty.

There is increased awareness among the public about the way financial institutions behave and how they invest their money. This is a result of the financial crisis but also because more people are concerned about ethical investment in general. Most people would be shocked to know that their money is funding nuclear weapon producers.

Ending financial involvement in nuclear weapon producers has a lot of benefits – both to financiers and to our collective campaign for a treaty banning nuclear weapons. When we can demonstrate that big banks (like Rabobank in the Netherlands, for example) have chosen to put in place a policy against investing in nuclear weapon producers, we can demonstrate whole of society support for the delegitimisation of these inhumane, indiscriminate weapons. The more the stigma of nuclear weapons is entrenched and mainstreamed, the more the continued inaction by some becomes unacceptable. Inaction and apathy for the nuclear weapons issue only allows for their continued proliferation, modernisation and deployment to continue – keeping the threat alive for future generations.

There is no economic reason for financial institutions to hold onto investments in nuclear weapons systems. There are countless investment possibilities that offer the same, or even a better return on investment without the risks of potentially funding a tool capable of wreaking a humanitarian catastrophe. The health and green energy sectors are proven to be more prudent investments, for example. Even bonds with Anheuser-Busch (an American beer manufacturer) are projected to carry a 5% return in 2020[1], whereas bonds from Northrop Grumman issued in May 2013 only offer a return after five years of 1.75%[2]. Investing in beer instead of nuclear bombs is something most campaigners can get behind.

For those financial institutions that have already wiped financiers of nuclear weapon producers from their books, a ban treaty, especially one with clear rules on the financial assistance aspect of the production of nuclear weapons (as has been seen in national interpretations of the cluster munitions ban), would further support this ethical investment practice, and help to create a world free of nuclear weapons. Any good bank should respond to the demands of its clients about policies and practices that they find offensive. Experience with other divestment campaigns shows that financial institutions feel the public pressure and respond to it accordingly.

Divestment is only one part of the path to a world without nuclear weapons, but it is an important one. A coordinated global effort for divestment from nuclear weapons producers can help put a halt to modernisation programmes, strengthen the international norm against nuclear weapons, and build momentum towards negotiations on a universal nuclear weapons ban. Some financial institutions, including government funds, have already opted to exclude nuclear weapons producers and financiers from their investment portfolios. It is time for others to end their voluntary involvement in the companies that are involved in the production and maintenance of the global weapons of mass destruction arsenal.

The Don’t Bank on the Bomb report was launched today in Stockholm. To find out if your financial institution is investing, or is one of those with a good policy on nuclear weapons, see the report at:  www.DontBankOnTheBomb.com

[1] BUD20A listing on NYSE, viewed http://www.nyse.com/bonds/nysebonds/CorporateBonds.html

[2] Don’t Bank on the Bomb, 2013, page 204.

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  • aiweiwei

    “Let’s act up! Ban nuclear weapons completely and unconditionally.”

    Ai Weiwei Artist and activist

  • sheen

    “If Gandhi and Martin Luther King Jr were alive today, they would be part of ICAN.”

    Martin Sheen Actor and activist

  • bankimoon

    “I salute ICAN for working with such commitment and creativity.”

    Ban Ki-moon Former UN chief

  • yokoono

    “We can do it together. With your help, our voice will be made still stronger. Imagine peace.”

    Yoko Ono Artist

  • jodywilliams

    “Governments say a nuclear weapons ban is unlikely. Don’t believe it. They said the same about a mine ban treaty.”

    Jody Williams Nobel laureate

  • desmondtutu

    “With your support, we can take ICAN its full distance – all the way to zero nuclear weapons.”

    Desmond Tutu Nobel laureate

  • herbiehancock

    “Because I cannot tolerate these appalling weapons, I whole-heartedly support ICAN.”

    Herbie Hancock Jazz musician

  • dalailama

    “I can imagine a world without nuclear weapons, and I support ICAN.”

    Dalai Lama Nobel laureate