Investing in Cluster Munitions: What's at Stake? 30 Cluster Munitions and the Oslo Process

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1 STATE-OF-THE-ART REPORT Contents Executive Summary, Recommendations and Methodology 8 Summary Tables 19 Introduction 30 Investing in Cluster Munitions: What's at Stake? 30 Cluster Munitions and the Oslo Process 30 Financial Institutions' Power and Responsibility 31 Our Research 32 Chapter 1 Hall of Shame: Financial Involvement and Investments Red Rag List of Cluster Munitions Producers Introduction and Methodology ATK (United States) China Aerospace Science and Technology (China) Hanwha (South Korea) Norinco (China) Poongsan (South Korea) Singapore Technologies Engineering (Singapore) Text ron (United States) The Investments Introduc tion and Methodology Aberdeen Asset Management (United Kingdom) Affiliated Managers Group (United States) Aflac (United States) Agricultural Bank of China (China) AJO (United States) Allianz (Germany) Allstate Corporation (United States) Amalgamated Bank of Chicago (United States) American Beacon Advisors (United States) American International Group (United States) American United Mutual Insurance (United States) Ameriprise Financial (United States) APS Asset Management (Singapore) Arovid Associates (United States) Associated Banc-Corp (United States) Banco de Sabadell (Spain) BancPlus (United States) Bank Hapoalim (Israel) 4g Bank of America (United States) Bank ofbeijing (China) Bank of China (China) Bank of Communications (China) Bank of Fast Asia (China) Bank of New York Mellon (United States) 5] 2

2 Banner Bank (United States) BB&T (United States) BlackRock (United States) California First National Bancorp (United States) Capital Group (United States) Carlyle Croup (United States) Cascade Bancorp (United States) Causeway Capital Management (United States) Central Pacific Financial Corporation (United States) Cheonanbukil Foundation School (South Korea) China Construction Bank (China) China Development Bank (China) China Everbright Croup (China) China Life Insurance (China) China Merchants Bank (China) China Minsheng Bank (China) China Securities (China) CITIC Croup (China) Citigroup (United States) CNO Financial (United States) Comerica (United States) Consus Asset Management (South Korea) Credit Mutuel (France) Credit Suisse (Switzerland) Daewoo Securities (South Korea) Davis Advisors (United States) DBS (Singapore) Deutsche Bank (Germany) Dimensional Fund Advisors (United States) Discovery Capital Management (United States) Dongbu Group (South Korea) E.SUN Financial (Taiwan) Eastern Bank (United States) Eaton Vance (United States) Eugene Investment & Securities (South Korea) Fidelity Investments (United States) Fidelity Worldwide Investment (United Kingdom) Fifth Third Bancorp (United States) First Eagle Investment Management (United States) First Niagara Financial (United States) Fubon Group (Taiwan) Gamco Investors (United States) Genworth Financial (United States) Goldman Sachs (United States) Grantham, Mayo, Van Otterloo & Co. (GMO) (United States) Croupe BPCE (France) Guotai Junan Securities (China) Haitong Securities (China) Hana Financial (South Korea) Hanwha Group (South Korea) Hanyang Securities (South Korea) Hartford Financial Services (United States) Hong Yuan Securities (China) 67 3

3 Hua Nun Financial (Taiwan) Hyundai Group (South Korea) Hyundai Heavy Industries (South Korea) Industrial Bank (China) Industrial & Commercial Bank of China (ICBC) (China) Invesco (United Kingdom) JP Morgan Chase (United States) KB Financial (South Korea) KDB Financial Group (Sout h Korea) Keycorp (United States) Knights of Columbus (United States) Korea Investment Holdings (South Korea) Land Bank of Taiwan (Taiwan) LSV Asset Management (United States) Macquarie Group (Australia) MassMutual Financial (United States) Matthews International Capital Management (United States) MetLife (United States) Mirae Asset Financial Group (South Korea) Mitsubishi UFJ Financial (Japan) Mi/.uho Financial (Japan) Morgan Stanley (United States) National Pension Service (South Korea) Nationwide (United States) Neuberger Berman (United States) New York Life Insurance Company (United States) Northern Trust (United States) Old Mutual (United Kingdom) Oversea-Chinese Banking Corporation (Singapore) People's Insurance Company (Group) of China (PICC) (China) People's United Financial (United States) PNC Financial (United States) Point 72 Asset Management (United States) Prudential (United Kingdom) Prudential Financial (United States) Raymond James Financial (United States) Regions Financial (United States) Royal Bank of Canada (Canada) Samsung Group (South Korea) Schröders (United Kingdom) Sealand Securities (China) Shenyin & Wanguo Securities (China) Shinhan Financial Group (South Korea) Shinyoung Asset Management (South Korea) Siemens Financial Services (Germany) SK Securities (South Korea) Standard Life (United Kingdom) State Bank of India (India) State Street (United States) Stifel Financial (United States) Sumitomo Mitsui Financial Group (Japan) Sun Life Financial (Canada) SunTrust Bank (United States) g6 4

4 Synovus Financial Corporation (United States) T. Rowe Price (United States) Temasek Holdings (Singapore) The London Company ofvirginia (United States) The Travelers Companies (United States) Teachers Insurance & Annuity Association (TIAA-CREF) (United States) Trimaran Capital Partners (United States) Truston Asset Management (South Korea) Two Sigma Investments (United States) UBS (Switzerland) Union Bancaire Privee (Switzerland) Unum Group (United States) US Bancorp (United States) Vanguard (United States) Wellington Management (United States) Wells Fargo (United States) Western & Southern Mutual (United States) William Blair & Company (United States) Williams Capital (United States) Woori Financial (South Korea) Yurie Asset Management (South Korea) 93 Chapter 2 Disinvesting from Cluster Munitions Producers Hall of Farne: Financial institutions pioneering in disinvestment Introduction and Methodology 94 HTHICAL BANKS ASN Bank (the Netherlands) Banca Etica (Italy) La Financiere Responsable (France) Triodos Bank (the Netherlands) 97 GOVERNMENT-MANAGED PENSION FUNDS Fonds de Compensation (Luxembourg) The Future Fund (Australia) Norwegian Government Pension Fund - Global (Norway) Swedish Pension Funds API-4 (Sweden) Swedish Pension Fund AP7 (Sweden) 100 MAINSTREAM FINANCIAL INSTITUTIONS (private) ABP (the Netherlands) APG (the Netherlands) A.S.R. (the Netherlands) ATP (Denmark) BPF Bouw (the Netherlands) The Co-operative Bank (United Kingdom) Delta Lloyd Group (the Netherlands) DNB (Norway) Folksam (Sweden) KLP (Norway) Laegernes Pensionskasse (Denmark) Menzis (the Netherlands) PenSam (Denmark) Pensioenfonds Horeca & Catering (the Netherlands) Pensioenfonds Zorg en Welzijn (the Netherlands) 106 5

5 PI A Pension (Denmarlc) PGGM (the Netherlands) Philips Pension Fund (the Netherlands) PME (the Netherlands) PNO Media (the Netherlands) SNS REAAL (the Netherlands) Sparinvest (Luxembourg) Spoorwegpensioenfonds (the Netherlands) SPW (the Netherlands) Stichting Pensioenfonds Huisartsen (the Netherlands) Stichting Pensioenfonds Openbaar Vervoer (the Netherlands) Storebrand Group (Norway) 2.2 Runners-up Financial Institutions Introduction and Methodology ARN Amro (the Netherlands) Actinica (the Netherlands) Aegon (the Netherlands) Aviva (United Kingdom) AXA (France) Barclays (United Kingdom) BBVA (Spain) Belfius (Belgium) BNP Paribas (France) Commerzbank (Gennany) Credit Agricole (France) Credit Suisse (Switzerland) Danske Bank (Denmark) Deutsche Bank (Germany) Ethias (Belgium) Generali (Italy) HSBC (United Kingdom) ING (the Netherlands) Intesa Sanpaolo (Italy) KBC (Belgium) Lloyds Banking Group (United Kingdom) National Pensions Reserve Fund (Ireland) National Providern Fund (New Zealand) New Zealand Superannuation Fund (New Zealand) NIBC (the Netherlands) Nordea (Sweden) Nykredit (Denmark) Pensioenfonds Vervoer (the Netherlands) Rabobank (the Netherlands) Royal Bank of Canada (Canada) Royal Bank of Scotland (United Kingdom) SEB (Sweden) Societe Generale (France) Standard Chartered (United Kingdom) Stichting Pensioenfonds APF (the Netherlands) Sumitomo Mitsui Trust Bank (Japan) Swedbanlc (Sweden) UniCredit Group (Italy)

6 Van I.anschot (the Netherlands) Vontobel (Switzerland) Countries' Best Practices Introduction and Methodology 137 DISINVESTMENT - LEGISLATION Belgium Ireland Italy Liechtenstein Luxembourg The Netherlands New Zealand Samoa Switzerland 153 DISINVESTMENT - MINISTERIAL AND INTERPRETIVE STATEMENTS Australia Bosnia and Herzegovina Cameroon Canada Colombia Congo, the Democratic Republic of Congo, the Republic of Croatia The Czech Republic France Ghana Guatemala The Holy See Hungary LaoPDR Lebanon Madagascar Malawi Malta Mexico Niger Norway Rwanda Senegal Slovenia The United Kingdom Zambia 163 INVESTMENT - PARLIAMENTARY INITIATIVES/DRAFT LEGISLATION 163 Conclusion and recommendations 164 Appendix 1 Glossary 165 Appendix 2 References 167 7

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