World's largest wealth fund pulls out of BAE systems over nuclear weapons links

UK defence firm one of nine companies excluded from investment by Norway's Government Pension Fund Global on ethical grounds

Picture: (Getty Images)

The world's largest wealth fund has pulled out of British defence company BAE Systems because of its involvement in making nuclear weapons.

Norway's Government Pension Fund, which has $1.1 trillion (£777bn) in assets, announced the firm was being dumped because it produces key components for the Trident and Minuteman III ballistic missiles.

BAE, which insists on its website that 'we do not provide or manufacture nuclear weapons“, agreed an eight year contract with the US to maintain and upgrade the weapons systems in 2015.

The Fund's Council on Ethics made its recommendation to drop BAE in March 2016 on the grounds that BAE's involvement in systems engineering meant they had a 'key role in the production or upgrading of the products'.

It said: 'Production or upgrading can also mean the production or upgrading of something that others have developed. Based on the above, BAE Systems plc must be regarded as producing key components for nuclear weapons and there is therefore reason to exclude the company.'

The Fund owned a 1.76 per cent share in the company in 2015, with investments worth £340 million.

Three other companies, the American engineering firms AECOM and Fluor Corporation and shipbuilding firm Huntington Ingalls Industries, were also excluded today for the same reason.

Since 2005 the Fund has dropped twelve other companies over the production of nuclear weapons, including Boeing, Lockheed Martin, Serco Group, Northrop Grumman, and Airbus. BAE was previously excluded in 2005 over its interest in a company producing a nuclear missile for the French military but this was revoked in 2012.

Nuclear weapons are included in the Fund's guidelines for exclusion because they 'violate fundamental humanitarian principles'.

In the same statement today, it was announced that Evergreen Marine Corp. (Taiwan) Ltd., Korea Line Corp., Precious Shipping PCL and Thoresen Thai Agencies PCL were excluded based on an “assessment of the risk of severe environmental damage and serious or systematic violations of human rights”. Pan Ocean Cobased were placed on observation for the same reason.

Polish firm Atal SA was excluded due to “unacceptable risk of serious or systematic violations of human rights”.

The Government Pension Fund Global, managed by Norges Bank, was set up in 1990 to invest oil revenues on the international market to provide for the Norway when its natural resources run out.