Businesses owned by the Russian state, and cosmetic firms that test on animals, top our list
Last month ministers called on the financial services industry to increase support for the UK’s defence companies, following concerns that environmental, social and governance (ESG) principles are seeing reduced investment in the sector.
Business secretary Jonathan Reynolds said that banks should not give in to “small but vocal campaign groups” who demand boycotts of defence companies, according to the FT.
So is the business secretary right that scepticism of defence businesses is restricted to a vocal minority? The answer seems to be “it depends”.
We asked Britons whether they would consider it unethical or not to invest in a series of 18 different types of businesses. When we asked about “defence companies”, a relatively low 24% of Britons said it would be unethical to invest in such firms – this was the fourth lowest figure on our list. Half (50%) do not consider investing in defence firms to be unethical.
However, when asked about investing in “arms manufacturers”, opinion flips. Almost half (49%) consider it unethical to invest in arms manufacturers, compared to only 31% who disagree. This appears to be a case where presentation and framing will be key to garnering public support.
What kind of companies are Britons most likely to say it is unethical to invest in?
When it comes to the wider results of our survey, sitting at the top of the table in terms of unethical investment choices are companies owned by the Russian government (75% say is unethical to invest in) and cosmetics companies that test on animals (74%).
Firms that facilitate the traditional vices of smoking and gambling are also seen as unethical investing opportunities by 68-69% of the public. A majority of Britons also say it is unethical to invest in medical companies that test on animals (61%), fast fashion companies (54%), and companies owned by the Chinese or Saudi governments (54-55%).
In terms of those companies that the public are least likely to see as unethical for investment, renewable energy tops the list, at just 8%. This is followed by ‘big tech’ companies, at 16%, and pharmaceutical companies, at 17%.
Unethical investment perceptions differ by age and voting behaviour
Perceptions are not consistent across generations, with some options more clearly seen as unethical by the younger or older generations.
Compared to the youngest Britons, over-65s are at least 10pts more likely to say that tobacco companies, as well as cosmetics firms that test on animals, are unethical firms for investment (although in both cases a majority of all age groups hold this view).
They are also more likely to consider it unethical to invest in companies owned by the Russian, Chinese and Saudi governments.
Younger people, by contrast, are more likely to see it as unethical to invest in the Israeli government than their elders – hardly surprising given the sympathy among that generation for the Palestinians. They are also more likely to take issue with investing in fossil fuel companies, arms manufacturers and/or defence firms, and artificial intelligence businesses.
When it comes to voters, the most clear split between those who backed the main left and right wing parties at the 2024 general election are Israeli firms, arms/defence companies, and fossil fuel businesses. Labour and Lib Dem voters between 20-40 points more likely to describe such investments as unethical than Tory and Reform UK voters.
This is also the case, to a lesser extent, for fast fashion, fast food, alcohol, and Saudi-owned companies.
There are also a couple of areas in which Reform UK voters notably stand apart, being less likely to describe tobacco firms and Russian-owned companies as unethical investing options than voters for the other three parties.
What do you think about the ethics of investing in defence firms, ethical investing in general, and everything else? Have your say, join the YouGov panel, and get paid to share your thoughts. Sign up here.
Photo: Getty
