Published on September 9th, 2015
Case study: banning investments in cluster munitions
Cluster Munition Coalition- member organisation PAX’s presented its latest case study today. The report shows that it is not only possible to install legislation banning investments in cluster munitions, but that financial institutions largely think such a ban is a good idea. In the Netherlands, disinvestment legislation has provided clarity and guidance to the financial sector.
Cluster Munition Coalition- member PAX presented its latest report on banning investments in cluster munitions in Dubrovnik (Croatia) today. States Parties to the Convention on Cluster Munitions (CCM) and campaigners from all over the world are gathered this week for the convention’s First Review Conference.
PAX’ latest report looks at the implications and impact of the Dutch prohibition on direct and demonstrable investments in cluster munitions producers. It presents a number of Dutch financial institutions’ and other stakeholders views on and experience with the disinvestment ban. The report highlights both the perceived positive and negative effects on the ban and, in conclusion, holds that it is not only possible to install disinvestment legislation, but that financial institutions largely agree that such a ban is a positive development.
The report was presented to states today at a side event on the issue on disinvestment organised by the Cluster Munition Coalition (CMC) and PAX. The CMC spoke about the international Stop Explosive Investments campaign. PAX presented the new report as well as the findings from the 2014 report ‘Worldwide Investments in Cluster Munitions; a shared responsibility’ report. This report looks at investments in cluster munitions producers as well as examples of states and financial institutions that ban investments in cluster munitions producers. CMC-member organisation Mines Action Canada (MAC) spoke about the national disinvestment campaign in Canada and recent developments.
More and more states are taking action against investments in cluster munitions. Spain recently adopted legislation that states “[…] it is forbidden to finance or to advertise this type of weapons […] by any means.” With the addition of Spain, there are currently ten states that have put in place disinvestment legislation. Additionally, there are 27 states that are of the view that investments in cluster munitions are, or can be seen as, prohibited under the convention.
The CMC and PAX hope that the report that was presented today will inspire other states to install national disinvestment legislation of their own. Although the Dutch law on direct and demonstrable investments contains exceptions that weaken the law, it does contain strong elements. The experience with the Dutch law could offer useful insights and lessons on banning investments in cluster munitions producers.