Investors are mobilizing to advance Palestinian human rights through their portfolios and investment processes.
A Palestine investment lens provides investors with the framework to include Palestine in ESG assessments and advance Palestinian human rights through investment portfolios. To date, environmental, social and governance, or ESG, frameworks have failed to account for the risks of investments with direct involvement in the military occupation in Palestine and the ongoing genocide in Gaza.
“We have been taught that Palestine is the exception. We keep hearing, especially in the US that it is too complicated to understand,” says Soheir Asaad of Funding Freedom.
Investors have a crucial role to play in advancing justice and human rights. It is the inception of the modern-day responsible investment ecosystem as we know it, starting in the 1970s and 1980s when investors mobilized against South African apartheid.
Now is an opportune moment in history to re-create this impact to redress what Amnesty International has called “a system which amounts to apartheid” instituted by the Israeli government against Palestinians in Palestine. Investor advocacy for Palestinian human rights is more crucial now than ever with a genocide in Gaza that may have taken the lives of as many as 180,000 civilians and left 1.9 million more without access to food, medical supplies and basic necessities.
In October 2024, the Investor Solidarity with Palestine Working Group launched its webinar series, “Palestine in your portfolio,” to mobilize asset owners and managers to align their stated commitments to upholding human rights and racial justice in investing. The working group is hosted by the Racial Justice Investing Coalition, a network of over 450 investment professionals and organizations seeking to advance racial justice in their own organizations and in their portfolios. More than 100 attendees, including portfolio managers, impact investors, shareholder engagement activists, and social justice grassroots organizers, attended the first webinar.
The next webinar in the series, “A portfolio construction to divest from state violence in Palestine and beyond,” will take place on January 15, featuring Kataly Foundation, Adasina Social Capital and Gaza Soup Kitchen (register here).
Context for Palestinian-lens investing
The inaugural “Palestine in your portfolio” webinar featured racial justice activists, philanthropy organizers and co-directors of Funding Freedom, Soheir Asaad and Rebecca Vilkomerson. Asaad and Vilkomerson, through their lived experiences, work and activism as a Palestinian and anti-Zionist Jewish organizer, respectively, laid out the historical context investors need to be aware of. Below are the takeaways and calls to action from the vibrant discussion:
The colonization of Palestine is rooted in economic exploitation. For decades, the Israeli government has been establishing settlements in the West Bank, which violates international law. Private businesses have been involved from the outset, benefiting from and contributing to the displacement of the indigenous Palestinian population.
The United Nations has found that Israel has denied Palestinians access to their natural resources, including shared water resources and an estimated 1.5 billion barrels of oil reserves in the West Bank as well as more than $2.5 billion worth of natural gas off the Gaza coast.
Last October, the Israeli Ministry of Energy and Infrastructure awarded six concessions for natural gas exploration to Israeli and foreign companies in zones that are Palestinian maritime areas under international law. This came shortly after the start of the Israeli invasion of Gaza.
Corporations enable and profit from the genocide in Gaza. Investors fund the genocide through investing in these holdings. Along with the Israeli state, the US, multiple other governments, and the private sector are actively participating in the extreme level of violence and devastation in Gaza.
US-based weapon manufacturers are supplying bombs and artillery used by the Israeli Defense Forces; if the US government withdrew its fiscal support of the Israeli state, they would not be able to sustain this devastation.
Aerospace and defense stocks have climbed to record highs since October 7, 2023. For example, Lockheed Martin, the manufacturer of the F-35 aircraft that Israel uses in its regular bombings of Gaza, at the close of trading on October 4, 2024, has produced a 55% percent total return, outperforming the S&P 500 by about 18%.
It is worth noting that a number of court cases around the world are questioning whether exporting F-35 parts to Israel complies with domestic laws and international treaties, which require assessing whether such parts could have been, or will be, used in violation of international humanitarian law. This poses significant legal, financial, and other ESG risks for investors with exposure to these holdings, despite the short-term large financial gains they reap (additional detail on risks provided later in this article).
The tech sector has supported ongoing surveillance and violence against Palestinians. An example here is Amazon and Google’s contracts with Project Nimbus, which the Israeli government explicitly frames as a project to provide cloud services and infrastructure for the Israeli military. Some of the specific technologies the contract provided access to include AI capabilities such as face detection, object tracking and sentiment analysis.
AI-driven projects such as “Lavender” analyze data related to nearly every person in Gaza to assess the probability they are a combatant for Hamas or another Palestinian militant group, though systemic biases and broad generalizations are often incorporated in these algorithms, which disproportionately group nearly all of Palestinian civilians as militants.
Another AI-driven program is “Where’s Daddy?” which determines whether targets are in their homes and has been reportedly used to regularly kill civilian fathers within their homes and among their families, thus the name. As of May 2024, the system has reportedly identified as many as 37,000 Palestinians as targets. For over three years, Google and Amazon employees have been protesting that this contract makes the companies complicit in Israel’s armed conflicts and its government’s illegal and inhumane treatment of civilian Palestinians.
There is increasing documentation of the relationship between the surveillance, racial profiling and excessive policing tactics used to target Palestinians by the Israeli government and military, and those used to target Muslim and Black Americans by police forces in the US.
“It’s really important to keep [action] rooted in what that means to actual Palestinian lives and on the land. And as people who live in the United States, which is supplying Israel directly with the weaponry that is destroying not just Palestinian lives, but the entire infrastructure that makes life possible, all of us who live here have a stake in stopping it,” said Vilkomerson.
Actions for investors
Investors must reckon with these takeaways in order to take appropriate action that navigates the paradox of socially responsible investors potentially complicit in genocide through our portfolios. Whether through investing in real estate development companies that seek to build off a fully-destroyed Gaza, or ETFs that have exposure to companies that are manufacturing weapons used to commit war crimes, it is essential for investors to do a thorough analysis of their portfolios to understand how they are not supporting harms, and instead, determine how to create benefits.
The Investor Solidarity with Palestine Working Group invites investors to take up the following calls to action:
1. Ensure systematic adherence to the UN Guiding Principles of Business and Human Rights.
2. Screen your portfolio for investments that abet the genocide in Gaza and the occupation in Palestine.
These present significant material risks, especially in light of the UN General Assembly’s adoption of a resolution that demands that Israel “brings to an end without delay its unlawful presence” in the Occupied Palestinian Territory, stemming from the International Court of Justice advisory opinion that concluded that Israel’s decades long occupation and annexation of Palestinian territory is unlawful. Amnesty International and Human Rights Watch have found evidence of crimes against humanity and acts of genocide.
Companies providing weapons, military AI, surveillance technology, and other tools used to target civilians could be mired in litigation. In fact, the United Nations Office of the High Commissioner is investigating enterprises, including financial institutions, in the commission of international crimes connected to Israel’s unlawful occupation, racial segregation and apartheid regime. This could present significant legal, financial, and other risks for investors with exposure to these holdings. Utilize the American Friends Service Committee’s human rights screening tool for publicly traded companies or reach out to The Institute for Ethical Venture Capital for support in screening venture capital investments.
3. Speak up! While implementing portfolio changes and updating policy statements are so critical and impactful, they do not require the investor community’s public voice. Part of the continuing issue is the fear that speaking about Palestine may lead to backlash.
Yes, this advocacy is often met with significant, sometimes public retaliation. However, a more outspoken investor community, rooted in business and human rights frameworks, can collectively shift the industry at large.
Investors, don’t underestimate your power as a fiduciary. Find your contribution to this work and build on it, whatever form it takes.
When investors took a stand against the South African apartheid regime through collective economic boycotts and divestments, they supported South African organizers in successfully moving the South African government to end its apartheid regime.
Together we can play our part in calling for the end to the genocide of Palestinians.
Anandi Somasundaram is a program lead with the Racial Justice Investing Coalition.
To learn more about ISPWG and future programs, fill out this form, and join the webinar, Wednesday, Jan. 15.
