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Banks try to take responsibility by blacklisting cluster bomb manufacturers

Lloyds Banking Group (Scottish Widows), Aviva, the Co-op and Royal Bank of Scotland have taken affirmative action to make sure that they do not support the manufacturing of cluster bombs and landmines. The four banks and insurers, amongst the biggest in Britain, have blacklisted twelve global companies that make and supply cluster munitions. The US defence companies Lockheed Martin and General Dynamics, along with South Korean conglomerate Doosan are three of the largest to be boycotted.

It appears that the banks are reacting to criticisms from human rights campaigners and clients who have voiced their concerns regarding investments in companies who produce cluster bombs. The arms industry is big business and it has been estimated that one in ten shares owned by Aviva and Scottish Widows will need to be sold and reshuffled in order to ‘clean up their act’.

It has been reported that some US investors and clients have been less complicit in the sell-off, which signals that perhaps a gap is widening between the responsibility and ethics of US and UK investment policies. Barclays and HSBC are expected to follow suit and join the blacklist bandwagon in the near future, as the move from Aviva, Lloyds, Co-op and RBoS, has put significant pressure on their own social responsibility strategies.

The manufacture, sale, and export of cluster bombs is now illegal in the UK and 42 other countries. However, notable omissions from the list include, the US, China, Israel, Pakistan, Singapore, and India. There are not currently laws put in place that prevent banks from investing in cluster munitions producers in the UK, but a positive trend is developing and the steps taken by four of the biggest banks and investors will be sure to support the cause.

Many feel that more could and should be done to combat the production of anti-personnel weaponry, but it is always a positive sign to see banks make a move that is not – directly at least – profit orientated.