"[Arms Control Today] has become indispensable! I think it is the combination of the critical period we are in and the quality of the product. I found myself reading the May issue from cover to cover."
Countries Ban Investment in Cluster Munitions
Pursuing what some say is a logical step required for the implementation of the Convention on Cluster Munitions (CCM), several countries have taken action at the national level by barring investment in companies that produce cluster munitions.
That step is backed by the Cluster Munition Coalition, an international group of nongovernmental organizations (NGOs) that actively supports the CCM. The group maintains that the prohibition on assistance outlined in Article 1(c) of the treaty should be broadly interpreted to include a ban on investments in companies that manufacture cluster munitions. The provision states that “each State Party undertakes never under any circumstances to assist, encourage or induce anyone to engage in any activity prohibited under this convention.” Because “financing and investing are active choices, based on a clear assessment of the company and its plans,” the group argued for the investment ban in a 2007 policy paper.
Currently,
Such efforts by a growing number of states have been endorsed by the NGO coalition, which on Oct. 29 launched a disinvestment campaign aimed at encouraging governments to end investment in the production of cluster munitions through national legislation. The groups supported their case with a report entitled “Worldwide Investments in Cluster Munitions: A Shared Responsibility,” published by coalition members IKV PAX Christi of the
The report shows a clear trend toward action by governments and financial institutions to limit or end involvement in financing cluster munitions production since the beginning of the
The report lists 136 financial institutions in 16 countries as being involved in the direct or indirect financing of cluster munitions production, with 45 of them in CCM signatory states. One-half of the institutions are in the
The report shows that there are now 30 financial institutions, nearly all in
The report also listed 16 “runners-up.” Companies in that category have policies on cluster munitions in place, but the authors of the report consider those policies ineffective because of certain shortcomings or loopholes, such as allowing for indirect financing of cluster munitions production.
According to the report,
After the law passed, Reuters quoted the lead author, Sen. Philippe Mahoux, as saying, “The financial groups which invest in or finance cluster bomb manufacturers will be outlawed.” Yet, according to a November report to the United Nations Association of Sweden from Ethix SRI Advisors, a consulting firm, the Belgian government “has yet to publish a list of restricted entities—companies and investment institutions—as set out in the law.”
The European Parliament indicated its support for banning investment in cluster munitions in October 2007 when, citing the example of the Belgian law, it passed a resolution calling for a moratorium on using, investing in, stockpiling, producing, transferring, or exporting cluster munitions. The resolution calls on EU countries to follow the lead of Belgium, Ireland, and Luxembourg in adopting national measures that fully ban the use, production, export, and stockpiling of cluster bombs.
In the
Disinvestment campaigns have been used in the past to apply pressure on countries to change their behavior or to achieve certain goals. During the 1980s, state and local governments in the