The largest European pension funds and insurers hold EUR 5.9 billion in investments in arms producers that sell weapons to states where there is a real risk these could contribute to serious human rights abuses, such as to Israel, Saudi Arabia, Pakistan, Egypt and the United Arab Emirates. The largest such investments are held by the Norwegian Government Pension Fund Global and German insurer Allianz. The investments by Dutch pension funds ABP and PFZW also feature in the report.
Against the backdrop of wars in Ukraine and the Middle East, arms companies, especially in Europe and the US, have been the main beneficiaries of record levels of military spending. Pressure on investors to financially back the arms sector has also increased. Arms companies and policy makers have been pushing for investments in the arms sector to be classified as ‘sustainable’ and some investors are indeed moving to include parts of the arms sector in their ‘sustainable funds’. However, the sustainability claims of the arms sector overlook the involvement of many arms companies in the sale of weapons to governments that violently oppress their citizens or that take part in armed conflicts with little regard for international humanitarian law. In March 2025, the UN Human Rights chief warned that, amid the highest number of violent conflicts since World War II, arms transfers are contributing to prolonging conflicts and to internal repression and severe violations of international law.
Our report looks at the arms sales of 14 of the largest global arms companies, including US-based Rolls-Royce, RTX, Boeing and General Dynamics as well as European companies Airbus, BAE Systems and Thales. From 2019 to 2024, these companies have sold weapons to 52 states where there is a high risk that these weapons contribute to severe human rights violations, violations of international humanitarian law, or to fuel armed conflicts. This includes sales to Israel, accused of committing genocide in Gaza, and to the United Arab Emirates, accused of diverting weapons to war-ridden Sudan, despite a UN arms embargo.
Arms companies have a responsibility for the impact their products have worldwide. According to global norms on business and human rights, they should make sure that their products do not contribute to adverse impacts on human rights. This means that they should not sell weapons to states where there is a clear risk of human rights violations or violations of international humanitarian law. If they do so, they run the risk of legal complicity in international crimes. According to the same norms, investors also have a responsibility to avoid investing in companies whose products are contributing to adverse impacts.
‘Investors that hold shares or bonds in companies that export weapons to high-risk destinations make profits at the cost of civilians suffering from the devastating violence caused by these weapons’, says Eva Gerritse, PAX’s business, conflict and human rights expert. ‘They should engage with arms companies to change their behavior and if that doesn’t happen, divest. Investors cannot claim to adhere to standards on responsible business conduct and at the same time invest in many of the world’s largest listed arms companies, given these companies’ involvement in high-risk arms trade. Let alone label these investments as ‘sustainable’. If anything, the global push for more investment in the arms sector should start with addressing the many controversies this industry is involved in. Investors should develop clear policies, excluding investments in companies selling weapons to highly controversial destinations.’
Note: the investment data as shown in the report is based on research that was carried out in April 2025. The data might not reflect the current (April 2026) holdings. In their reply to PAX, Norwegian pension fund GPFG indicates that it has divested from General Dynamics and L3 Harris. Dutch pension fund PFZW indicates that per 30 September 2025 it only holds a position in Rolls-Royce, and no longer in CSSC, Rheinmetall and Saab.
