Allianz scraps nuclear, military exclusions to back Europe's rearmament drive
LONDON, March 31 (Reuters) - Germany's Allianz Global Investors has dropped two exclusions blocking its sustainable funds from investing in defence, becoming one of the first major European asset managers to change their policies to help finance the region's rearmament.
AGI wrote to its clients late last week to advise that its sustainable funds could now buy into companies that earned more than 10% of their revenue from military equipment and services.
here.
Removal of a second exclusion means they can also now invest in nuclear weapons activities as long as they are within the Nuclear Non-Proliferation Treaty, which seeks to stop the spread of nuclear weapons-making capabilities.
The investor had recognised the restrictions were too "onerous", said Matt Christensen, AGI's global head of sustainable and impact investing, in an accompanying blog post published online.
"Nuclear weapons are a critical and credible deterrent to large-scale conflict and, in Western countries, the production of nuclear weapons is fully integrated into the industry and cannot be separated," Christensen added.
AGI, part of insurer Allianz (ALVG.DE), opens new tab, manages about 570 billion euros ($615.77 billion) in assets.
The changes come amid a broader drive by European investors to reconsider their policies on investing in defence, under pressure from clients and some politicians to loosen restrictions.
Funds badged as sustainable have come under particular scrutiny, as they often have stricter exclusions. Few asset managers have actually changed their policies so far.
Defence stocks have soared in value this year as European countries, under pressure from U.S. President Donald Trump, have vowed to increase military expenditure, with Germany unveiling a massive ramp-up in defence and infrastructure spending.
AGI's changes apply to funds classified as 'Article 8' under the European Union's Sustainable Finance Disclosure Regulation, and would apply in most cases, the investor said in its letter to clients.
Article 8 is the broadest category for sustainable funds under the EU rules, while the higher Article 9 category refers more directly to sustainability.
AGI said several exclusions would still apply, including to companies that severely violated international rules and to manufacturers of chemical and biological weapons.
($1 = 0.9257 euros)
Hashtags
Try Our AI Features
Explore what Daily8 AI can do for you:
Comments
No comments yet...
Related Articles
Times
31 minutes ago
- Times
FCA considers lifting ban on bitcoin ETNs for retail investors
The Financial Conduct Authority is poised to ditch a six-year ban on some crypto-based products for retail investors even as it warned that consumers could still stand to 'lose all their money'. The City watchdog said on Friday that it was exploring the means to allow retail investors to tap into crypto exchange-traded notes, or ETNs. The product has been prohibited for individual investors since 2019. Presently, only professional investors are able to deal in the product, which enables people to trade on the price of a cryptocurrency without owning the underlying asset. It is similar to an exchange-traded fund, which investors use to gain exposure to equities without owning the stock itself. David Geale, the executive director for payments and digital finance at the Financial Conduct Authority, said the plans were emblematic of its 'commitment to supporting the growth and competitiveness of the UK's crypto industry'. He added: 'We want to rebalance our approach to risk and lifting the ban would allow people to make the choice on whether such a high-risk investment is right for them, given they could lose all their money.' The FCA will take views from the crypto industry over the space of four weeks before lifting the prohibition of ETNs for retail traders. In April, the UK government said it would bring cryptocurrency into the parameters of regulation for the first time, aligning it with the United States and the European Union. The new regulatory framework was designed to 'crack down on bad actors while supporting legitimate innovation', the government said at the time of the announcement. Rachel Reeves, the chancellor, said then of the new regulations: 'Through our 'plan for change', we are making Britain the best place in the world to innovate and the safest place for consumers. Robust rules around crypto will boost investor confidence, support the growth of fintech and protect people across the UK.' The price of bitcoin, the world's foremost cryptocurrency, has been hugely volatile this year owing to President Trump's erratic policymaking. In the first few months of the year, bitcoin rose sharply as traders braced for the Trump administration to launch policies that emboldened the crypto industry. However, these policies have yet to materialise which, alongside Trump's on-again-off-again tariffs, pushed bitcoin down sharply, before a recent rally that pushed it up to a record high of $112,000 last month. On Friday afternoon, one bitcoin could fetch $103,975, representing a 2.38 per cent daily increase.
Telegraph
40 minutes ago
- Telegraph
Two private schools close in wake of Labour's VAT raid
Two prep schools have become the latest victims of Labour's VAT raid by announcing their closures as a result of the levy. Park Hill School in Kingston, Surrey, said the introduction of the 20pc tax on fees in January had led to a decline in pupil numbers meaning it was no longer financially viable to operate. Falcons School, a neighbouring school in Putney, south-west London, said a raft of tax changes including the VAT levy and increases to National Insurance alongside a higher minimum wage had 'intensified' a decline in pupil enrolment forcing it to close at the end of the academic year. It comes after figures this week revealed private school pupil numbers had fallen by more than 11,000 in England following the VAT raid on fees – four times more than government forecasts. There were around 582,500 pupils at English private schools in January compared to 593,500 at the same point last year, according to the Department for Education. Parents at Park Hill were told this week the 75-year-old school would be forced to close with children offered the opportunity to move to a nearby sister school. The decision came as a shock to many, with the school's website this week still advertising a recent open day for prospective pupils. The school had also written to parents in March to thank them for 'continued loyalty and support' in spite of the introduction of VAT and offered a 5pc discount to families who paid the following year's school fees early. However, on Wednesday, in a letter seen by The Telegraph, Amit Mehta, chief executive of Inspired Learning Group, which owns the school, said: 'Following careful reflection, we have made the strategic decision to relocate pupils from Park Hill to join our sister school, Westbury House, from January 2026. 'We are incredibly proud of everything Park Hill has achieved over the years. However, like many schools, it also faces challenges, and this evolution offers fresh opportunities for all our pupils.' Park Hill, which has 84 pupils aged between two and 11, will transition into a fully-fledged nursery which is exempt from VAT. Justin Spanswick, chief operating officer at Inspired Learning Group, said: 'The decision was made because of the downward trend in pupil numbers at Park Hill, due in part to the introduction of VAT on school fees.' He added the decision would also strengthen Westbury House 'in the current climate', with pupils moving to the school helping to shield it from the Government's tax rises. Falcons School decided to absorb the 20pc VAT levy in January and kept fees frozen at £6,270 per term in a bid to arrest a decline in pupil numbers. In March the school told the families of its 126 pupils that it was 'considering the future viability' of the school and that it was 'likely to close'. The school was taken over by Inspired Education Group in 2023 and made the decision to admit boys for the first time in an attempt to increase pupil numbers. A spokesman for the school said: 'As a result of the thorough consultation process, we have taken the difficult decision to close the school at the end of the academic year. 'The consultation took place as the school has been loss-making since we acquired it, with enrolment under 50pc over the last two years. THis has been intensified by the recent government changes such as VAT.' Ministers have admitted the Government expects 100 private schools to close as a result of its VAT raid.
-holds-a-banner-as-he-takes-part-in-the-No-More-Austerity-2-0-march.jpeg%3Ftrim%3D0%2C0%2C0%2C0%26width%3D1200%26height%3D800%26crop%3D1200%3A800&w=3840&q=100)
The Independent
an hour ago
- The Independent
Jeremy Corbyn amongst thousands at rally to protest Labour ‘austerity'
Thousands protested in central London against government spending cuts and welfare reforms, organised by The People's Assembly and attended by former Labour leader and independent MP Jeremy Corbyn. Organisers, including The People's Assembly, criticised the government for implementing spending cuts that disproportionately affect vulnerable members of society. Various organisations, such as the National Education Union, Green Party, and RMT union, participated in the march from Portland Place to Whitehall. Protesters held signs with slogans like 'Tax the rich, stop the cuts – welfare not warfare' and 'Nurses not nukes'. A People's Assembly spokesperson stated that adherence to 'fiscal rules' traps the UK in a public service funding crisis, advocating for taxing the rich to fund public services and investment.
