Dutch pension funds facing total cluster bomb ban after MPs vote

Lower chamber passes vote to outlaw investments in related companies.

Dutch MPs have voted to back a motion that would prohibit Dutch financial institutions such as pension funds and banks from investing in firms which manufacture cluster bombs. A majority of MPs backed the motion submitted by the Socialist and Labour parties earlier this week in the Tweede Kamer lower house of parliament. Socialist Party MP Krista van Velzen hailed the vote as a great success after years of campaigning on the issue. “Banks and pension funds can now no put longer money into companies which make cluster bombs,” she said in a statement. Big Dutch pension funds funds such as ABP and PFZW (formerly PGGM) are unlikely to be affected, although smaller pension funds are likely to have to review their portfolios. PFZW has 30 exclusions, mostly involved in the production and trading of controversial weapons, such as nuclear weapons, landmines and cluster bombs. ABP says its does not invest in companies directly involved in manufacturing landmines, cluster bombs or chemical or biological weapons. It had 16 companies on its exclusion list according to its 2008 annual report.Gert Kloosterboer of the VB Dutch industry-wide pension fund association, told Responsible Investor.com: “Our response would be that we do not foresee real problems for our member funds to act according to the outcome of this vote by the Tweede Kamer,”
The proposal followed a recent report by peace organisation IKV Pax Christi and Netwerk Vlaanderen which found that 138 financial institutions worldwide still provide over $20bn (€13.5bn) worth of investments and financial services to eight companies related to the production of cluster bombs – almost a year after the Oslo Convention to outlaw Cluster Munitions, was signed by more than 100 states. Last year the Netherlands signed a treaty agreeing to remove all forms of cluster bombs from its military arsenal. Cluster bombs spread tiny bombs over a large area and cause very high civilian casualty rates.