The Deadly Trade That Depends on Charity Finance; Should Hospitals, Schools and Churches Withdraw Their Money from Companies That Export Weapons?
Palfreyman, Louise, Sunday Mercury (Birmingham, England)
THE arms trade is big business in Britain.
The government ploughs millions of pounds into supporting an industry which churns weapons and military equipment out to oppressive regimes across the world.
The market is thought to be worth pounds 5 billion a year and, for this reason, investors can expect sizeable returns from shares bought in companies such as BAe Systems, Rolls Royce and GKN - all of which export arms.
But when the organisations buying these shares are hospitals, churches, schools and charities and when the money invested is public money or even charitable donations, it is hardly surprising that an outcry ensues.
Last week, the Sunday Mercury revealed that four NHS hospital trusts had invested more than pounds 250,000 of charitable donations in companies supplying oppressive regimes.
It is money that the Campaign Against Arms Trade (CAAT) believes that companies with links contrary to the interests of the investing organisation should be avoided.
Unison, the health union, goes one step further by arguing that the cash should be ploughed back into services.
Shropshire and Royal Shrewsbury hospital trusts said last week that they had not been aware of the link and would now consider selling the shares.
But City Hospital NHS Trust said it was bound by law to ensure the best return for investors - an argument used by many trustees and fund managers.
CAAT has published share information that reveals the true extent of Midland investment in companies manufacturing weapons.
Their rogues' gallery features religious groups, charities, educational establishments and local authorities.
The public tide of opinion on ethical investment is changing as the financial dealings of major institutions are held up to scrutiny.
And there are now more than 40 share funds dealing exclusively in ethical investment, so that the public can buy shares with a clear conscience.
However, it seems that 'unethical investments' are far from a thing of the past.
The Labour Party was embarrassed only two weeks ago by revelations that its pensions fund had investments in Marconi which makes a range of military equipment including torpedoes.
The Catholic Church was so taken aback by revelations last year that it had shares in LucasVarity and Rolls Royce that it sold them.
Barnardo's pledged to carve out an ethical investment policy and the Children's Society recently sold 808 shares in BAe Systems that it had received in a bequest.
But the Church of England is still investing massively in Marconi and GKN. And smaller church organisations, such as the Leicester Diocesan Trust and the West Midlands branch of the United Reformed Church, both have investments that their congregations may object to.
The Church of England argues that it will not invest in companies whose main focus is armaments.
Neville White, senior ethical investment researcher for the Church of England said: "We have a duty to make the best returns balance with the expectations of our investors.
"GKN is largely a car manufacturer - defence is not the main focus.
"We do monitor and review our policy so concerns can be raised, and sold our BAe Systems shares when GEC merged and became Marconi."
Leicester Diocesan Trust also sold its BAe Systems shares after the merger but admitted that it was difficult keeping track of companies' interests.
A spokeswoman said: "All we can do is try to avoid unethical links. …