Arms and the Academy

Forty-five UK universities and university colleges currently hold significant investments in arms companies. Research published by Campaign Against Arms Trade (CAAT) revealed that universities such as Oxford, Cambridge and UCL invest millions of pounds in companies that sell arms to repressive regimes, such as BAE Systems, Rolls Royce and Cobham. This is all the more concerning when one considers the amount of research these universities carry out in partnership with the same military companies. The relationship between arms companies and higher education has deepened in recent years but largely gone unnoticed. This is a failure of university democracy and transparency.

It is particularly instructive to consider why so many universities with investments in the arms trade are members of the Russell Group – a collection of elite institutions which accounts for 65% of UK Universities' research grant and contract income. Perhaps they want to stay on good terms with the companies that supply their universities with much needed investment. Earlier this year, Malcolm Ace, Director of Finance at Southampton University, told students that it would be ‘hypocritical’ to sell his university's shares in BAE Systems when it receives hundreds of thousands of pounds worth of research funding from them year on year.

Did you know? The UK arms industry is subsidised by the government by around £890m per year! Last year the government licensed military exports to 13 out of the 20 countries it considers to be the worst human rights abusers in the world. In September 2005, six peaceful protesters, known as the George Fox Six, were found guilty of disturbing a 'corporate venturing' conference at Lancaster University promoting BAE Systems and other multinational companies. They are currently appealing the decision. Rolls Royce, whose customer base includes 160 armed forces, currently supports over 20 University Technology Centres which are embedded in 15 universities across the UK, including Sheffield, Oxford, Cambridge and Imperial College, London.

Undoubtedly the impetus for these growing ties stems from the fact that UK higher education funding is suffering from significant shortfalls. Research collaborations provide substantial funding for university departments – but in return for them becoming outsourced research facilities for private companies. Universities' science, engineering and technology agendas are inevitably shifted from independent research to the stimulation of particular industrial sectors: like the guided weapons technology centres at Cranfield University and Imperial College London, part-funded by arms company Qinetiq; or the 20 University Technology Centres funded by military aerospace giant Rolls-Royce. Arms companies are already subsidised by public money to the tune of £890m annually – just short of the £950m which will be raised each year by top-up fees, according to the Institute of Fiscal Studies. It seems that public money can be found for weapons, but not for education. Yet universities are expected to provide research for these already over-protected companies. And whether or not students and dons regard the commercialisation of higher education as financially necessary, they shouldn't be made to contribute to commercial interests which involve not just corporate profit, but the development of products designed to maim and kill; nor to collaborate with companies whose core markets include conflict zones and human rights abusers.

BAE Systems has been in the news recently, as the company was under investigation by the Serious Fraud Office (SFO) over allegations of multimillion pound bribery during sales to Saudi Arabia since 1986. That was until Tony Blair pressurised the SFO to halt the inquiry in December last year for reasons of national security. The Saudis had threatened to withdraw co-operation on security and cancel a supply contract for Eurofighter Typhoons. Following the Prime Minister's intervention however, the deal with the oppressive Saudi regime is back on track.

Saudi Arabia has no political parties or trades unions, nor is there freedom of association, nor an independent media. Women are denied the vote and face severe restrictions on movement. Flogging remains routine and Amnesty reports that torture and extra-judicial killings by Saudi security forces are escalating under the cloak of the 'war on terror'. Malcolm Ace has informed Southampton students at the council meeting that their university had been investors in BAE Systems ‘since approximately 1987.’

We may hesitate to believe that anyone purposefully invests in an arms company because it may secure a lucrative contract to export weapons - thus raising its stock price. Nonetheless, incidences of public institutions, such as universities, profiting from such deals are an inevitable consequence of investing in the arms trade.

Over the past twelve months however, there have been encouraging signs of resistance to the influence of militarism on campus. Thousands of students and staff around the country have mobilised to take action resulting in policy changes at student union and university level. Protests, petitions and student journalism caused SOAS, Bangor, St Andrews and Goldsmiths to take real steps towards divestment. Students at Manchester held die-ins and other high-profile events, culminating in 300 students passing a Union motion for ethical investment. This has led to the university engaging directly with students concerning the future of university finances.

These changes have occurred only because activists have used persuasive moral and financial arguments to explain why investing in the arms trade is unnecessary and wrong. They have shown that it is not only possible for universities to fulfil their financial duty whilst investing ethically, but that this is also beneficial. Ethical investment funds that preclude arms company shares are amongst the most profitable. In the past decade the Church of England’s £4.3 billion ethically-managed fund, was the second best performer of more than 1,000 funds. Furthermore, the fact that the majority of university arms investors hold less than 2% of their overall investments in arms companies means that divestment will not have a significant impact upon their portfolios.

Unfortunately, several universities persist in denying the public access to data concerning their finances - following requests made through the Freedom of Information Act - either citing commercial confidentiality or simply ignoring requests for information. It is only through universities becoming transparent and accountable that students and staff can fully understand how their institutions are managed. If students are to be more than indebted consumers of knowledge, they must be given access to all relevant information – thus enabling them to participate meaningfully in university life.

It seems that the justification for such investments often boils down simply to financial habit. Without anyone questioning the status quo, institutions renowned for their commitment to internationalism and human progress will continue to support companies whose profits rest upon proliferating weapons and sustaining international tension. By uncovering the scale of university investment in the arms trade, and by providing university members with information and support, CAAT's University Clean Investment campaign will empower students and staff to lead the way in getting arms out of education. Divestment from companies who market killing will be a major step forward.