Nuclear Weapons Pass ESG Test as War Redefines Ethical Investing

The deadliest weapons ever manufactured are becoming a regular feature of Europe’s nearly $9 trillion ESG fund industry, as a label long associated with ethical investing gets stretched to accommodate the geopolitical moment.

Since Russia’s full-scale invasion of Ukraine in February 2022, the number of ESG equity funds exposed to the nuclear arms industry has soared more than 50% to over 2,000. Though the holdings represent just a fraction of the wider defense sector, the shift means that roughly half the ESG-registered equity funds in Europe are now allocating at least some capital to companies that manufacture, supply or transport nuclear arms, according ...