Britain's investors shy away from UK defence companies
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UK investors have reduced their holdings in some of Britain's leading defence companies since Russia's invasion of Ukraine last year, underlining concerns in Westminster that the sector lacks support in the City of London.
Article originally published by The Financial Times. Hargreaves Lansdown is not responsible for its content or accuracy and may not share the author's views. News and research are not personal recommendations to deal. All investments can fall in value so you could get back less than you invest.
Published by
07 Aug 2023
Fund managers based in the UK have cut their holdings in companies including BAE Systems and Qinetiq by an average of 9 per cent since the start of 2022, according to data from the London Stock Exchange Group.
By contrast, EU investors increased their ownership of British defence groups by 9 per cent while raising exposure to European companies by 4 per cent.
The UK government has blamed environmental, social and governance (ESG) guidelines for acting as a barrier to investment in the sector.
Britain’s City minister Andrew Griffith and defence procurement minister James Cartlidge have warned that the UK’s long-term security is being put at risk as a result.
Kevin Craven, chief executive of ADS Group, the UK industry trade body, said: “Overcautious or misapplied ESG considerations are drastically impacting the ability
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