PGGM exits five Israeli banks over West Bank financing, despite extended dialogue

Dutch giant says divestment was its only option

PGGM, the Dutch asset manager with €153bn under management for five pension schemes, has divested its shares in five Israeli banks owing to their involvement in financing Israeli settlements on the occupied West Bank.
The five banks are Bank Hapoalim, Bank Leumi, Bank Mizrahi-Tefahot, the First International Bank of Israel and Israel Discount Bank.
In a statement, PGGM said it decided to divest after a prolonged dialogue with the banks about their involvement with the settlements. PGGM agrees with both the United Nations and the International Court of Justice that the settlements are illegal.
It also believes the settlements are a major obstacle to a peaceful resolution of the Israeli-Palestinian conflict. The Israeli government, which has promoted settlement of the West Bank for years, disagrees with these views.
In any case, PGGM’s dialogue with the banks went nowhere. “The dialogue showed that given the day-to-day reality and domestic legal framework they operate in, the banks have no possibility to end their involvement in the financing of settlements in theoccupied Palestinian territories,” the asset manager said, adding that divestment was its only option.
Including the five banks, PGGM now excludes seven Israeli firms from its investments. The others are detonator maker Aryt Industries (cluster munitions) and defense electronics manufacturer Elbit Systems Ltd (West Bank).
PGGM did not disclose the amount it had invested in the banks, but the Israeli newspaper Haaretz said it was in the “tens of millions of euros.” The manager also said it was talking to several other unnamed companies about their involvement with the settlements and would report on progress.
PGGM is one of the biggest names in responsible investment. Its chief executive, Else Bos, sits on the Board of the Principles for Responsible Investment (PRI).

Last month PGGM described how it and other investors, NGOs and customers such as Unilever, had succeeded in persuading palm oil company Wilmar to make a switch to sustainable production.

PGGM’s updated exclusion list