US states which pushed back against the decision by Unilever subsidiary Ben & Jerry’s to halt operations in Palestine’s occupied territory are reviewing the situation following the sale of the ice cream firm’s operations in Israel, Responsible Investor can reveal.
Last July, Ben & Jerry’s announced plans it would end sales in the Occupied Palestinian Territory once its licence agreement expires at the end of 2022.
The move prompted a backlash from US states opposed to any boycott of Israel, including pledges to divest from Unilever. More than 30 states have taken action to discourage support for the pro-Palestinian Boycott, Divestment and Sanctions (BDS) initiative, which works to end international support for Israel.
On Wednesday, Unilever announced that Ben & Jerry’s business interests in Israel had been sold to Avi Zinger, the owner of local licensee American Quality Products. The arrangement means Ben & Jerry’s will be sold under its Hebrew and Arabic names throughout Israel and the West Bank under the full ownership of its current licensee.
In a statement, Unilever said: “Under the terms of Unilever’s acquisition agreement of Ben & Jerry’s in 2000, Ben & Jerry’s and its independent board were granted rights to take decisions about its social mission, but Unilever reserved primary responsibility for financial and operational decisions and therefore has the right to enter this arrangement. Unilever has used the opportunity of the past year to listen to perspectives on this complex and sensitive matter and believes this is the best outcome for Ben & Jerry’s in Israel. The review included extensive consultation over several months, including with the Israeli government.”
Arizona Treasurer Kimberly Yee, who put Unilever on the state’s list of firms that violate its anti-BDS law and divested a total of $143 million in funds, gave a muted welcome to this week’s announcement.
“I am pleased that Unilever overturned the decision made by Ben & Jerry’s and changed their course of action to boycott Israel as I requested in September 2021,” she said. “I am disappointed it took this long for a decision to be made. Our investment team will undertake a careful review of Unilever before deciding to invest again.”
The office of New York State Comptroller Thomas DiNapoli – who is the trustee of the New York State Common Retirement Fund – told RI it was reviewing Unilever’s announcement. In October 2021, the fund pledged to divest its holdings in the consumer goods group.
Similarly, a spokesperson for the Division of Investment in New Jersey, which last year put Unilever on its prohibited investment list, said: “[We] will review new information to determine if any next steps are needed.“
The office of Texas comptroller Glenn Hegar, which also placed Unilever on its list of companies that boycott Israel, told RI they are analysing the situation.
Michael Mahoney, chairman of the Illinois Investment Policy Board, which previously put Unilever on its prohibited investment list, said: “The board has a process for appealing all determinations. Unilever is welcome to begin this process and the board will look into the facts of the issue.”
Other state officials were more reluctant to review their position.
Florida’s State Board of Administration (SBA) told RI: “SBA must identify companies that boycott Israel based on very specific definitions and scope outlined in section 215.4725, Florida Statutes. At this time, it does not appear that the status of Unilever remaining on the state’s ‘Scrutinised Companies that Boycott Israel List‘ would change.“
And the Colorado Public Employees’ Retirement Association (PERA) said there was no change to its Board of Trustees’ vote in March to add Unilever to its restricted companies list.
At the time of publication, Unilever had not responded to RI’s request for comment on the opinions put forward by the states.