Norway’s GPFG urged to divest from Germany’s Rheinmetall

The Norwegian Government Pension Fund Global is being urged to divest from German defence group, Rheinmetall, by a group of institutional investors and non-governmental organisations (NGOs).

The campaign is led by Shareholders for Change (SfC) founding members Bank für Kirche und Caritas and Fondazione Finanza Etica.

In the letter, they call on the sovereign wealth fund to reconsider its investment in Rheinmetall, which supplies bombs to Saudi Arabia for the war in Yemen, and to enter into a critical dialogue with the company on its arms export practices.

Commenting, BKC head of sustainability research, Tommy Piemonte, said: “Investors should stop supporting companies that export arms to countries that are involved in or contribute to human rights violations. Especially if this violates their own investment policies.”

According to the campaign group, the GPFG is a major investor in Rheinmetall, owning 2.57 per cent of its shares for a total of ca. €116m.

“The fund invests according to precise ethical guidelines since 2004 and divests from companies that are not compliant with them,” Fondazione Finanza Etica director, Simone Siliani, explains. “We believe that the investment in Rheinmetall is in clear contrast with the fund’s guidelines.”
According to Section 2,1 of the guidelines, “the fund shall not be invested in companies which (...) produce weapons that violate fundamental humanitarian principles through their normal use.”
According to the European Center for Constitutional and Human Rights (ECCHR), which is one of the signatories, the Yemen war has no international legitimacy and has already killed over 100,000 people since 2015, including 12,000 civilians in directly targeted attacks. During the conflict, a large number of bombs used by the Saudi Arabia-led alliance have been produced and supplied by Rheinmetall’s Italian subsidiary RWM Italia SpA.

On 11 December 2019, a group of human rights organisations led by the ECCHR, Mwatana for Human Rights and Rete Italiana Disarmo filed a criminal complaint with the International Criminal Court in The Hague against arms companies, including Rheinmetall, that, by supplying arms to Saudi Arabia, have knowingly supported human rights violations in Yemen.

As early as 2017, the Bank für Kirche and Caritas and Fondazione Finanza Etica have been calling on Rheinmetall’s executive and supervisory boards, at the annual general meetings of the company, to refrain from exporting arms to countries that are involved in or contribute to human rights violations. The group said that so far, Rheinmetall has ignored these appeals.

The group believes that Rheinmetall’s arms exports may result in legal actions and sanctions for the company due to human rights violations. “We hope to be able to convince the Norwegian pension fund as a major shareholder to exert pressure on Rheinmetall’s corporate governance in order to avoid, in its own interest, reputational, legal as well as financial risks,” Piemonte concluded.

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