Investigation Reveals Super Funds Investing in Controversial Weapons Industry
Amidst the ongoing conflicts in Ukraine and the Middle East, the weapons industry is experiencing a surge in profits and share prices. As the demand for arms increases, Australian institutions like universities and local governments are facing pressure to divest from investments in weapons manufacturers, despite the lucrative returns they offer.
Superannuation funds, known for offering “ethical” or “socially aware” investment options that avoid the weapons industry, have come under scrutiny. An ABC investigation revealed that some of these funds, including Australia’s largest fund, have invested millions of dollars of their customers’ retirement savings into companies producing controversial and devastating weapons of war.
One such weapon is the PGU-14/B, a 30mm round manufactured by General Dynamics, designed to penetrate tanks and armored vehicles. This round contains a penetrator made from depleted uranium, a radioactive material linked to an increased risk of cancer.
Despite promises to exclude investments in companies involved in depleted uranium weapons, some funds like Australian Retirement Trust (ART) were found to have held shares in General Dynamics. ART defended its actions, stating that the shares were held as collateral for a loan and were quickly divested once discovered.
The investigation also uncovered holdings in companies involved in controversial weapons across various super funds, raising concerns about the lack of consistent definitions and screening processes for such investments. Calls for a unified definition of controversial weapons have been made to ensure transparency and accountability in the industry.
Furthermore, the analysis revealed instances where funds held shares in companies producing white phosphorus bombs, a weapon known for causing severe burns and long-term health effects. The debate around the classification of such weapons and the need for stricter exclusion policies continues.
As regulatory bodies like the Australian Securities and Investments Commission crack down on misleading claims by funds regarding their ethical investments, the industry faces increased scrutiny. With the value of weapons stocks on the rise amidst global conflicts, the ethical implications of investing in the weapons industry are being brought to the forefront.
The investigation sheds light on the complexities and ethical dilemmas faced by super funds in balancing financial returns with social responsibility, prompting calls for greater transparency and accountability in the investment sector.
