Worldwide investments in CLUSTER MUNITIONS
report-worldwide_investments_cluster_munitions-2016
report-worldwide_investments_cluster_munitions-2016
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Conclusion and recommendations<br />
As this update shows, many people are hard at work on the issue of cluster munitions. States are<br />
ratify<strong>in</strong>g and implement<strong>in</strong>g the Convention on Cluster Munitions and f<strong>in</strong>ancial <strong>in</strong>stitutions are<br />
adapt<strong>in</strong>g to the norm set <strong>in</strong> the CCM. However, the report also shows that many f<strong>in</strong>ancial <strong>in</strong>stitutions<br />
are still l<strong>in</strong>ked, <strong>in</strong> one way or another, to <strong><strong>in</strong>vestments</strong> <strong>in</strong> cluster munitions producers.<br />
Dis<strong>in</strong>vestment is a complex issue; it is not always easy for f<strong>in</strong>ancial <strong>in</strong>stitutions to implement a<br />
comprehensive dis<strong>in</strong>vestment policy. We are aware of this complexity –funds follow<strong>in</strong>g an <strong>in</strong>dex<br />
be<strong>in</strong>g a case <strong>in</strong> po<strong>in</strong>t. Nevertheless, we believe that it can and should be done. It is encourag<strong>in</strong>g to<br />
see that most of the newcomers to the Hall of Fame and runners-up categories come from countries<br />
where campaigners raised the issue with their governments or f<strong>in</strong>ancial <strong>in</strong>stitutions. In addition to<br />
f<strong>in</strong>ancial <strong>in</strong>stitutions, a grow<strong>in</strong>g number of governments have started giv<strong>in</strong>g time and attention to<br />
dis<strong>in</strong>vestment. Support for prohibitions on the f<strong>in</strong>anc<strong>in</strong>g of cluster munitions production seems to<br />
have ga<strong>in</strong>ed momentum over the years. Our report tells of many f<strong>in</strong>ancial <strong>in</strong>stitutions that were able<br />
to develop and implement a comprehensive dis<strong>in</strong>vestment policy. We s<strong>in</strong>cerely hope more f<strong>in</strong>ancial<br />
<strong>in</strong>stitutions will follow. Because dis<strong>in</strong>vestment can be complex and because it is a shared<br />
responsibility, we see the need for governments to issue clear guidel<strong>in</strong>es or laws. We hope that the<br />
new edition of this report has provided facts and figures that will <strong>in</strong>spire all actors – states, f<strong>in</strong>ancial<br />
<strong>in</strong>stitutions and civil society – to work for a world without cluster munitions. To reach this goal we<br />
submit the follow<strong>in</strong>g propositions on <strong>in</strong>vest<strong>in</strong>g <strong>in</strong> cluster munitions producers:<br />
• States that have jo<strong>in</strong>ed the CCM should make clear that <strong>in</strong> prohibit<strong>in</strong>g assistance, article 1(1)c<br />
of the convention prohibits <strong>in</strong>vestment <strong>in</strong> cluster munitions producers.<br />
• States should draft national legislation prohibit<strong>in</strong>g <strong>in</strong>vestment <strong>in</strong> producers of cluster<br />
munitions. This provides clear guidel<strong>in</strong>es for f<strong>in</strong>ancial <strong>in</strong>stitutions and is <strong>in</strong> the spirit of the<br />
CCM and <strong>in</strong> l<strong>in</strong>e with the Dubrovnik Action Plan.<br />
• F<strong>in</strong>ancial <strong>in</strong>stitutions should develop policies that exclude all f<strong>in</strong>ancial l<strong>in</strong>ks with companies<br />
<strong>in</strong>volved <strong>in</strong> cluster munitions production. Because all <strong>in</strong>vestment facilitates this production,<br />
no exceptions should be made for third-party f<strong>in</strong>ancial services, for funds that follow an <strong>in</strong>dex<br />
or for civilian project f<strong>in</strong>anc<strong>in</strong>g for a company also <strong>in</strong>volved <strong>in</strong> cluster munitions. Policies should<br />
not be narrowed to refus<strong>in</strong>g project f<strong>in</strong>anc<strong>in</strong>g for cluster munitions.<br />
• F<strong>in</strong>ancial <strong>in</strong>stitutions should <strong>in</strong>form producers of their decision to end <strong>in</strong>vestment because of<br />
the producers’ <strong>in</strong>volvement with cluster munitions. F<strong>in</strong>ancial <strong>in</strong>stitutions can set clear deadl<strong>in</strong>es<br />
with a limited time frame with<strong>in</strong> which a company must cease production of cluster munitions<br />
if it wishes the dis<strong>in</strong>vestment decision to be reversed. When a company persists <strong>in</strong> produc<strong>in</strong>g<br />
cluster munitions after the deadl<strong>in</strong>e, the f<strong>in</strong>ancial <strong>in</strong>stitution will dis<strong>in</strong>vest until such time as<br />
the company term<strong>in</strong>ates production of cluster munitions. New applications for <strong>in</strong>vestment will<br />
be decl<strong>in</strong>ed until the company has halted all activities related to the production of cluster<br />
munitions.<br />
• F<strong>in</strong>ancial <strong>in</strong>stitutions should apply their dis<strong>in</strong>vestment policy to all activities: commercial<br />
bank<strong>in</strong>g, <strong>in</strong>vestment bank<strong>in</strong>g and asset management. All such activities aid and abet a company’s<br />
production of cluster munitions. When this new course of action requires a change <strong>in</strong> <strong>in</strong>vestment<br />
fund management, <strong>in</strong>vestors should be notified of this and given a deadl<strong>in</strong>e for withdraw<strong>in</strong>g<br />
from these funds. After this deadl<strong>in</strong>e, management strategy will change and shares and<br />
obligations <strong>in</strong> companies <strong>in</strong>volved <strong>in</strong> cluster munitions will be sold.<br />
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