Exclusive, 06 March 2012
The Royal Bank of Scotland (RBS) has been accused of “profiting from the terrible industry of death” by investing more than £3 billion since 2008 into companies which develop and make nuclear bombs around the world.
An authoritative new report has lifted the lid on the bank’s widespread financial support for 16 multinational corporations involved in nuclear weapons factories, missiles, bombers and submarines in the UK, the US and France.
Amongst those who have benefited from RBS loans and bond underwriting worth hundreds of millions of pounds are the US giants, Boeing, General Dynamics and Northrop Grumman. Companies active in the UK like Rolls Royce, BAE Systems and Babcock have also been received financial backing worth many tens of millions of pounds (see table below).
The report has been endorsed by the famed South Africa anti-apartheid activist and Nobel peace prize laureate, Archbishop Desmond Tutu. “Nuclear weapons are an obscenity,” he said. “They are the very antithesis of humanity, of goodness in this world.”
Squandering billions of pounds on bombs “is an outrageous theft of public resources at a time when there are people who go hungry, when children are dying because they have no clean water, when diseases run rampant,” he argued.
Tutu called on banks like RBS to withdraw their investments in the nuclear arms industry. “Divestment was vital in the campaign to end apartheid in South Africa,” he said.
“Today, the same tactic can – and must – be employed to challenge man’s most evil creation: the nuclear bomb. No one should be profiting from this terrible industry of death, which threatens us all.”
The 180-page report, entitled “Don’t Bank on the Bomb”, was written by experts for the International Campaign to Abolish Nuclear Weapons, which brings together groups from 60 countries. It was funded by the Dutch ethical investment firm, Profundo.
The report identifies more than 300 financial institutions in 30 countries involved in financing companies that build nuclear warheads and the machines that carry them. RBS is exposed as one of the global nuclear weapons industry’s biggest backers.
“Any use of nuclear weapons would violate international law and have catastrophic humanitarian and environmental consequences,” said one of the report’s authors, Tim Wright.
“By investing in nuclear weapons producers, RBS is in effect facilitating the build-up of global nuclear forces. This is undermining efforts to achieve a nuclear-weapon-free world, and heightening the risk that one day these ultimate instruments of terror will be used again.”
Janet Fenton, from the campaign group, Scotland’s for Peace, was “outraged” to learn of the major nuclear role played by RBS. The bank has been majority owned by UK taxpayers since it was bailed out during the financial crisis by the UK government in October 2008.
“RBS customers must speak up and demand that their money isn’t used to fund the build-up and modernisation of nuclear arms,” she said. “If the bank chooses to ignore the public, customers should seek ethical alternatives.”
The report says that nuclear-armed nations spend more than £60 billion a year maintaining and improving their nuclear forces. Much of the work is carried out by private companies, backed by financial institutions providing loans, underwriting bonds and buying shares.
Other banks named along with RBS for bankrolling the bomb include the Bank of America, BlackRock and JP Morgan Chase in the United States; BNP Paribas in France; Deutsche Bank in Germany; and Mitsubishi UFJ Financial in Japan. RBS has also been accused in the past of investing in a series of projects that damage the environment or undermine human rights (see table below).
RBS insisted, however, that it adhered to policy guidance from the UK government and the appropriate international legal standards. “RBS acts in accordance with the strict regulation and licensing arrangements set by the UK government, and by relevant international standards, when engaging with companies involved in the design, manufacture, support and trade of defence equipment,” said a bank spokesman.
How RBS backs nuclear bombs
company / what it does / RBS financial support since 2008
General Dynamics / builds US Trident nuclear submarines / £414m
Boeing / manufactures long-range missiles for the US / £345m
Safran / produces nuclear missiles for the French navy / £337m
Finmeccanica / involved in the production of French nuclear missiles / £337m
Northrop Grumman / makes US nuclear missiles / £335m
Thales / builds nuclear missiles for the French navy / £272m
Serco / helps run the Aldermaston nuclear bomb factory in Berkshire / £216m
Bechtel / operates US nuclear weapons laboratories / £158m
Honeywell / helps produce US nuclear missiles / £156m
Lockheed Martin / develops both UK and US nuclear weapons / £136m
Babcock / maintains Trident nuclear weapons system on the Clyde and elsewhere / £136m
EADS / manufactures French nuclear missiles / £98m
Alliant Techsystems / make US nuclear missiles / £97m
Rolls‑Royce / maintains and makes Trident submarines in the UK / £91m
BAE Systems / produces nuclear missiles for France and helps modernise the UK nuclear weapons / £83m
Redhall / contractor at the nuclear bomb factory at Aldermaston in Berkshire / £139,000 shareholding
Total / £3.2 billion
RBS’s other controversial investments
- loaned nearly £5 billion to companies involved in extracting oil from Canadian tar sands since 2007
- invested over £300 million in French oil company, Total, while it was exploring Madagascar for tar sands
- provided £13 billion funding for 66 oil and gas companies since 2008, including BP, Shell and Cairn Energy
- accused of propping up the brutal military regime that runs Burma by collaborating with the Bank of China in 2007
- given financial support worth £163 million to Vendanta Resources, a British company accused of undermining human rights at an aluminium refinery in India
- invested £147 million in companies making cluster bombs which kill or maim children
- criticised for investing in a £2 billion oil pipeline across Turkey in 2004