When a financial institution adopts a comprehensive policy prohibiting financial involvement with companies that produce nuclear weapons (see section 8.1), those companies will be unable to access that institution’s funds for any purpose. If divestment becomes widespread, nuclear weapons producers will find it increasingly difficult to access the financing that they need. This should create a powerful incentive for those companies to stop producing nuclear weapons.
When pension funds, universities and other organisation decide to sell their shares in nuclear weapons producing companies, the stigma attached to nuclear weapons grows. The negotiation of the TPNW has brought renewed focus on the indiscriminate and inhumane nature of nuclear weapons and widespread divestment will further delegitimise the position of states that claim to depend on them.
See the cluster munitions case study for an example of how this can work.