Swedish govt funds join Norway in ban of Israel’s Elbit Systems over West Bank barrier

Funds follow advice of Ethical Council in potentially controversial sell-off.

Four Swedish government pension funds with combined assets of SEK800bn (€81.8bn) have mirrored a decision by the Norwegian Government Pension Fund and blacklisted Elbit Systems, the Israeli defence technologies firm, from their investment portfolios for human rights violations in the Palestinian territories. The move by pension buffer funds AP1, AP2, AP3 and AP4 followed a recommendation from the funds’ Ethical Council. It said it had recommended the ban because it deemed Elbit Systems was linked to violations of international rights conventions through its building and maintenance of a surveillance system for parts of the separation barrier on the West Bank. A 2004 ruling by the International Court of Justice in The Hague found that the construction of the Israeli separation barrier contravened international law – a ruling that Israel has challenged. The boycott decision by the Swedish funds could be controversial. A diplomatic stand-off developed between Israel and Norway when the €276bn Norwegian Government Pension Fund blacklisted Elbit Systems inSeptember last year. In a statement, Michael Eligal, Israel’s Ambassador to Oslo, reacted angrily to the findings of the Norwegian fund’s Council on Ethics. The Swedish AP Ethical Council says that despite “repeated requests”, Elbit Systems has refused to comment on the issue and that, while it prefers dialogue to exclusion, it will exclude a company as a last resort. The Council said it wanted Elbit to desist in supplying the surveillance system and associated services for the sections of the barrier wall that lie in occupied territory. It also wants Elbit to adopt a corporate policy that prevents it from contributing to contraventions of international humanitarian law.
According to its investor relations web site, Elbit’s three largest shareholders are Migdal Insurance of Israel, BlackRock Institutional Trust Co. and hedge fund Renaissance Technologies.
The AP funds Ethical Council has also issued its 2009 report outlining its exclusion and engagement decisions.
Link to AP Ethical Council Report 2009