German banks take stand against weapons makers on ethical grounds

(MENAFN) Several German banks have taken a stand against classifying weapons manufacturers as ethical investments, reaffirming their commitment to peace and sustainability. In a joint statement, eight financial institutions—including GLS-Bank, KD-Bank, Evangelische Bank, and PAX Bank—declared they would continue excluding defense companies from their sustainable investment portfolios.

Despite the sharp increase in European defense spending following the escalation of the Ukraine conflict in 2022, the banks stated that investments in the arms industry do not align with ethical or sustainable principles. They emphasized that clients seeking ethical investments should be confident that their money does not support weapons production.

The banks issued the statement in response to the German banking industry’s recent loosening of restrictions, which now allow sustainable investment funds to include companies primarily engaged in defense and arms manufacturing.

However, the group maintained its stricter standards, continuing to exclude firms that earn more than 3–5% of their revenue from weapons-related activities. They argued that such businesses do not contribute to the UN’s Sustainable Development Goals and instead cause harm to human life, civil society, and the environment.

The banks clarified that weapons manufacturers still have access to traditional, non-ethical financial products and are therefore not financially disadvantaged by their exclusion from sustainable portfolios.

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