Due Diligence and Corporate Liability of the Defence Industry: Arms Exports, End Use and Corporate Responsibility

Abstract

Due diligence is a frequently used concept that describes measures aimed at preventing and mitigating adverse impacts and risks. Due diligence should be highly relevant to the defence industry: It is estimated the combined arms sales of the world’s top 100 armsproducing and military services companies to have been $531 billion in 2020, of which 21 per cent (or $109 billion) was derived from the arms sales of 26 European companies. Such an overall market size is accompanied by a general recognition of the adverse impacts that exported arms may have in either intended countries or ultimate destinations. Despite the recognition of adverse impacts, relatively limited attention has been paid to due diligence and the associated liability of arms-exporting companies compared to those applicable to some other business sectors.