Sweden’s Seventh AP Fund (AP7), the default pension choice for millions of savers, is under growing fire for a string of investments tied to human rights abuses. What started with criticism over links to Myanmar’s military junta has now widened into a broader debate about whether the country’s biggest pension vehicle is failing its own ethical standards.
The Myanmar case is the clearest example. AP7 still holds nearly SEK 290 million (€26–28 million) in the Indian defence company Bharat Electronics Limited (BEL). The firm has exported weapons to Myanmar’s junta, including a weapons station reportedly used in attacks on civilians. BEL has already been blacklisted by the UN and Norway’s sovereign wealth fund, and Sweden’s Council on Ethics advised divestment years ago. Other state pension funds—AP1 through AP4—acted on that advice. AP7 did not. Instead, it insists it needs “further verification,” even as BEL ignores every attempt at dialogue.
The exposure doesn’t end there. AP7 also invests in Japanese telecom giants that provide infrastructure support to Myanmar Post and Telecommunications, a company controlled by the junta. Activist groups argue that these investments make Swedish pensions complicit in building the digital backbone of repression.
Now scrutiny is spreading beyond Myanmar. Recent reporting from SVT revealed that Swedish AP funds, including AP7, have placed billions in companies accused by the UN of enabling rights violations in Gaza. One of the most high-profile examples is Palantir, the US firm developing AI-driven combat management systems and maintaining close cooperation with Israel’s military.
Together, these cases sketch a troubling pattern. While Sweden prides itself on high ethical standards in foreign policy and finance, AP7 has repeatedly lagged behind its peers. It is now the only major state pension fund still exposed to BEL. It has also been slower to act on other companies accused of facilitating abuses. Meanwhile, its financial performance is not offsetting these risks: AP7 reported a -3.7 percent return in the first half of 2025, compared with positive gains from other AP funds.
Bottom line: AP7 isn’t just facing one-off controversies. It is facing a credibility crisis. Each delayed divestment raises the same question—why is the fund charged with safeguarding Swedes’ pensions consistently the last to move when companies are tied to violence against civilians? Until AP7 closes these ethical blind spots, pressure from activists, the media, and Sweden’s own Council on Ethics is only going to intensify.