Northrop Grumman Says It Will Walk Away From Cluster Bomb Contract

Northrop Grumman said Thursday that it would walk away from a U.S. government cluster bomb contract as the company moves to distance itself from the deadly weapons commonly associated with civilian casualties.

The contract involves the “testing of cluster munition components” and is “structured to help remove cluster munitions safely,” Northrop CEO Kathy Warden said on her company's quarterly earnings call on Thursday.

The company does not make cluster munitions, which are air or ground-launched bombs that contain submunitions that spread indiscriminately over a wide area. Unexploded weapons from wars decades ago are still killing civilians.

“We recognize that even supporting an area like cluster munitions for investors is of concern, because safe removal implies that at one point there was an embracing of the use of these products,” she said. “When we look at our portfolio, we are going to continue to recognize, we support our government and our allies in the important work of enabling our troops to do their work, but at the same time, be thoughtful about potential human rights implications, and how these technologies may be used in the future and provides equal consideration to safeguards associated with them.”

With Democrats now controlling the White House and Congress, Warden used the earnings call to tout the company’s environment, sustainability, and workforce-diversification efforts.

“When we look through the lens of sustainability at our portfolio, we look at not only what capability we're providing, but how it's being used, or how we expect the customer to use that capability going forward,” she said.

Still, Warden said, she expects no “significant changes” to the company’s portfolio.

Her comments come as the Biden administration has reportedly frozen several controversial weapons sales to Saudi Arabia and the United Arab Emirates. The Trump administration cleared multibillion-deals to sell F-35 stealth fighters and armed drones to UAE. It also reportedly approved a $500 million deal that would have allowed Raytheon to sell smart bombs to Saudi Arabia. Earlier this week, Raytheon CEO Greg Hayes said he expects the Biden administration to block that deal.

“Generally speaking, when it comes to arms sales, it is typical at the start of an administration to review any pending sales to make sure that what is being considered is something that advances our strategic objectives and advances our foreign policy,” Secretary of State Anthony Blinken said Wednesday. “So that’s what we’re doing at this moment.”

Saudi and UAE airstrikes have killed thousands of civilians in Yemen’s civil war, according to UN reports.“We already have a portfolio where we have looked through that lens in making decisions about where we invest and what work we undertake,” she said. “This was just one small contract that came to us through the acquisition, and we've made a decision to stop performing in that area.”

Northrop’s decision to abandon the contract represents “a symbol of the stigma attached to these weapons,” said Jeff Abramson, coordinator of the U.S. Campaign to Ban Landmines and Cluster Munition Coalition.

“Investors have gotten a lot of pressure not to invest in companies touching cluster munitions,” he said.

Warden said Northrop would walk away from the cluster munition “surveillance” contract by the end of the year.

“A stockpile surveillance program is a continuing process of testing of a stockpile to track its reliability as it sits in storage for the balance of its shelf life,” said Mark Hiznay, associate director of the Arms Division of Human Rights Watch.

Textron, the last U.S. company to make cluster bombs, announced in 2016 that it would quit producing them, after the Obama administration banned sales to Saidi Arabia. ATK was a supplier to the CBU-87 and Sensor Fuzed Weapon cluster munitions.

Warden, who became CEO of Northrop in January 2019, touted Northrop’s recently being named in the top 25 of gender-balanced S&P 500 firms as well as being named to DiversityInc’s list of Top 50 Companies for Diversity for more than a decade. The Biden administration has assembled what is believed to be the most diverse Cabinet in U.S. history.

“In our endeavor to enable global security and human advancement, we recognize the importance of our environmental, social and governance responsibilities, and we expect to continue leading our industry forward,” Warden said.