Defense giant BAE Systems linked to arms deals in countries accused of human rights abuses, report finds

LONDON — BAE Systems, the U.K.'s largest defense contractor, has established trading relationships with countries accused of human rights abuses, according to a new report that reveals theextensive reach of its lucrative arms business.

Over the past decade, the defense giant had a definite trading relationship with 81 countries and a reported relationship with a further 12, together accounting for almost half (48%) of all countries globally, an investigation by U.K.-based non-profit Action on Armed Violence found.

Included in those are 13 countries on the U.K.'s human rights abuse watchlist, as well as 29 countries whose military actions have injured or killed civilians. A further nine countries on the list have experienced one or more military coup d'etats over the past 10 years, AoAV, which is funded by poverty prevention charity the Joseph Rowntree Foundation, found.

BAE said it will neither confirm nor deny who it sells to, but noted in a statement to CNBC that it plays "a key role in enabling legitimate governments to defend their nation and protect their people," and that it rigorously upholds ethical standards.

It comes as BAE Systems sales have surged, hitting£194 billion ($242 billion) in the 10 years to 2022, with cumulative operating profits totalling£17 billion over the period, according to the report.

In 2023, the company said orders "exceeded targets," coming in at £37.7 billion. Its share price has risen around 27% over the past year.

The report said the booming trade highlighted how some defense companies were profiting from the lucrative arms trade amid rising global instability.

Iain Overton, co-author and AOAV chief executive, told CNBC the investigation could be the first of many delving into the trade flows