Norway’s trillion sovereign wealth fund, recognized as the largest in the world, has recently announced a significant divestment from the US-based construction equipment company Caterpillar. This decision is emblematic of the fund’s commitment to upholding ethical standards in global investments, reflecting its concern over potential involvement in human rights violations associated with ongoing conflicts in Gaza and the West Bank.
The Norwegian central bank stated that Caterpillar was excluded from the fund’s portfolio due to an “unacceptable risk” concerning its operations, which were seen as potentially contributing to serious violations of individual rights in violent contexts. The ethics council of the fund articulated concerns that equipment made by Caterpillar has been employed by Israeli authorities in actions leading to the damaging of Palestinian properties. Officials noted the gravity of these circumstances, highlighting a pressing need for companies to adopt measures that prevent their products from being utilized in contravention of international humanitarian standards.
Alongside Caterpillar, the fund has also divested from five Israeli banks: Hapoalim, Bank Leumi, Mizrahi Tefahot Bank, First International Bank of Israel, and FIBI Holdings. The exclusion of these financial institutions arises from their roles in facilitating construction activities in Israeli settlements within the West Bank, including East Jerusalem. The ethics council emphasized that these settlements are established in disregard of international law, asserting that their continuity signifies an ongoing contravention of global legal standards.
In line with international sentiments on this issue, the International Court of Justice (ICJ) reaffirmed last year the urgent call for the cessation of Israeli settlements built on Palestinian territories acquired in 1967. The court underscored that the establishment of such settlements is not only unlawful but also detrimental to the peace process and the establishment of a future Palestinian state.
Last week, a coalition of 21 nations issued a joint statement denouncing Israel’s plans to construct a large settlement covering a 12 square kilometer area east of Jerusalem, referred to as “E1.” This proposed development, which includes plans for 3,400 new residences for Israeli settlers, has the potential to isolate significant portions of the West Bank from East Jerusalem, raising concerns about the future of Palestinian territories.
As the Norwegian fund continues its ethical investment strategy, it is vital to recognize its stance as a proactive move towards promoting corporate responsibility and adherence to international norms in regions of conflict. The fund’s extensive investments globally, amounting to stakes in approximately 8,400 companies, further demonstrate its influence and commitment to socially responsible investing.
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