Stockholm (NordSIP) – Citing the “deterioration of the security situation in Europe”, NATO’s expansion to Sweden and Finlands and the evolving need to “significantly increase its security and defence investments to strengthen its deterrent level and defence capabilities”, SEB has updated its Sector Policy on Arms to be open to the defence industry.
“It is our view that our policy framework needs to be updated to adapt to the evolving security landscape. As a responsible corporate citizen, SEB strives to play an active role in contributing to strengthening Europe’s defence, security and resilience through providing financial services and investments. This is of key importance to uphold and defend European democracy and freedom,” says Hans Beyer, Chief Sustainability Officer at SEB.
Nevertheless, SEB recognises that the arms and defence sector is complex, with a number of risks, which the updated sector policy seeks to mitigate.
What’s In?
SEB framed the new decision in terms of the activities it avoided, even if in general the policy made the bank more permissive. Thus, while before SEB was not allowed to invest in nuclear weapons now it can, as long as the relevant company is headquartered in a NATO country.
“SEB avoids business relationships with companies, headquartered outside of a NATO country, involved in the development, testing, production, manufacturing, acquisition, possession or stockpiling of nuclear weapons. The updated policy thus means that SEB allows business relationships with companies involved in these activities, as long as they are headquartered in a NATO country,” SEB explains.
On a general note, SEB noted that it is no longer unable to support all transactions involving sales of arms and defence-related equipment. Instead, the ban was clarified to only apply to non/European or non/allied countries.
“SEB avoids supporting transactions involving sales of arms and defence-related equipment that either lacks an export license from a country in the EU, EEA, the UK or Switzerland or is destined to countries or areas that are subject to EU embargo or other relevant sanctions. In addition, SEB expects companies to have a Human Rights Due Diligence (HRDD) process for their sales and export activities taking into account the characteristics of the product as well as the conflict and human rights situation of the export destination,” SEB explains.
What’s Out?
SEB’s pre-existent outright ban on controversial weapons remains, with the bank noting that “SEB avoids business relationships with companies that produce controversial weapons.”
Furthermore, SEB also added a restriction regarding semi-automatic arms has been added. SEB avoids business relationships with companies producing semi-automatic arms intended for non-military and non-law enforcement activities.
