As geopolitical tensions rise, responsible investors are asking tough questions: Is there a case for responsible investment in defence?
The discussion examines the complexities of defence in the environmental, social and governance context. With NATO members increasing their budgetary commitments and European states boosting spending, defence is becoming a more prevalent part of the investment landscape. Yet reputational, human rights, and environmental risks remain at the forefront of investor concerns. The panel unpacks exclusion versus inclusion approaches, the rise of dual-use technologies, transparency challenges, and the role of stewardship in shaping defence practices.
Detailed Coverage
- The case for defence investment: Torben argues that democracy and national security are foundational, making military capacity essential to safeguarding rights and advancing long-term societal goals.
- Human rights and environmental risks: Estelle highlights investor obligations for heightened due diligence, noting reputational, environmental, corruption, and legal risks tied to weapons.
- Evolving client expectations: Mark outlines shifting European regulation and investor sentiment, with non-labelled funds more open to limited defence exposure under strict conditions.
- Dual-use technologies: The blurred line between civilian and military innovation (cyber, AI, drones, green energy) challenges investors to navigate benefits and risks.
- Transparency and disclosure: All panelists agree that investors need clearer reporting from defence companies — not on classified technology, but on customers, contracts, and safeguards.
- Stewardship opportunity: Rather than blanket exclusion, investors could push for higher standards by engaging directly with defence companies and shaping industry norms.
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