Svenska Dagbladet, 17 June 2008, 5 Questions, Ylva Edenhall

(An interview with Reinhilde Weidacher, senior analyst at consulting firm Ethix.)

An international convention that forbids the manufacture and use of cluster munitions was agreed in Dublin on 30 May by 111 countries including Sweden.

- What does the agreement mean for investors?

Many Swedish investors, including pension funds, fund managers and banks, have holdings in weapon manufacturers and now they have to go through those holdings. Many institutional investors have already woken up and want to know more. If the convention is officially signed in December, as expected, the position of those investors who have already acted will be stronger.

- What is the problem for investors?

It’s hard to know if a company is involved in the manufacture or maintenance of cluster munitions. International consolidation in the defence industry has made the ownership picture more complicated and many companies don’t give a clear answer if they are producers. Often it depends on who asks the question. There is a lack of transparency. It is hard for investors to find information, and it’s also a question of definition.

- Why should cluster weapons be banned?

Cluster weapons cover a large area and can be left behind in trees and on house roofs. Like mines they can explode long afterwards, for example when children find them.

- Why the interest in cluster weapons only now, when they have been around for decades and Sweden has of course produced them also?

Sweden wanted to ban cluster weapons as early as the 1970s. The cluster munitions question became highly topical again after the war in Lebanon in 2006 when many of these weapons were used. Norway and Belgium have led the way in not investing in companies who are involved in cluster weapon production.

- Which countries have not adopted the convention?

Russia, the USA, China, Pakistan, India and Israel. But the convention is important anyway. European companies will stop their involvement in cluster munition production. Investors are important and shape public opinion.