More major funds join cluster bomb company boycott

Irish reserve fund to review while Denmark’s Industriens pulls out of cluster bomb links.

The €21.3bn ($32.7bn) Irish National Pension Reserve Fund (NPRF) is reviewing its investments in cluster bomb manufacturers with a view to divestment. It follows the Irish government’s participation in talks on an international treaty to ban cluster bomb production, similar to that for landmines under the Ottawa Convention.
Adrian O’Donovan, a senior manager with the Irish fund said: “In the light of the government’s commitment, we have been contacted by the department of finance to look at how companies involved in the manufacturing of cluster bombs can be removed from the fund.”
He said the NPRF had yet to decide on the approach it would take. The Irish review follows hard on the heels of a decision by Denmark’s Industriens Pension, the €6.25bn ($9.1bn) industry-wide pension fund for blue-collar workers, to divest similar investments. Industriens recently came under intense pressure from Danish NGOs over its holdings, as did its Danish peer Danica Pension, the €33bn pensions arm of Danske Bank. Danica announced it would pull €13.8m of shares from Raytheon, Lockheed Martin, General Dynamics and L-3 Communications. In February, Responsible Investor revealed that The Red Cross was considering an international campaign to lobby pension funds over investments in companies linked to the manufacture of cluster bombs.
The NPRF is a signatory to the United Nations’ Principles of Responsible Investments and said itinvested about €28m in companies on the Norwegian Government Fund’s black-list of companies, which has become an ethical benchmark for many international pension funds. O’Donovan said: “We have some investments in companies that are involved in the manufacture of cluster bombs, both through our index portfolios and through our active managers.” The Irish Department of Foreign Affairs is organising the Dublin Diplomatic Conference on Cluster Munitions starting on May 19. The conference follows meetings in February in New Zealand between governments and campaigners from around the world to initiate discussions on an international cluster bomb treaty.
Separately, Danish DKK445bn (€65bn) pensions giant ATP has told it may change the way it makes and implements ethical investment choices. The fund is launching a review of its portfolios in the wake of domestic criticism about its holdings. Danish trades unions have challenged ATP’s investment in businesses linked to the production of nuclear weapons.
Jørgen Søndergaard, supervisory board chairman at ATP said: “We’re going to make an evaluation of the guidelines. We don’t have a fixed term for that. It will take place in one or more board meetings over the course of this year. But we’ll look at how other investment funds have made up their guidelines to see if we can learn anything from them.”