THE OUTGOING chairman of defence giant BAE Systems has said it is sad that it has taken a war for governments around the world to prioritise defence spending.

BAE announced last week that it took in a record £37bn in new orders in 2022, and forecast even higher earnings for this year "Government's first responsibility is to protect its people, and to do that it has to have a strong defence industry... It's sad that it took a war to trigger the recalibration [by investors] that has happened over the past 12 months, but it did," Sir Roger Carr told the Sunday Times in an interview.

Carr said the buzz around ESG was a "huge shift" from the original focus on EPS, or earnings per share. While ESG issues were "appropriate and worthy" objectives, a "balance of the two is still right," he said.

Many investors had previously dropped defence companies on ethical grounds, but Russia's invasion of Ukraine has forced a broader re-think on arms investments.

(c) 2023 City A.M., source Newspaper