US: TIAA-CREF, divest from Injustice
This article was written in 2010 as a contribution to a BNC e-magazine commemorating the 5th anniversary of the BDS call in July 9th 2005. Click here to read other articles in the magazine.
On July 9, 2004, the International Court of Justice found Israel’s Wall built on occupied Palestinian land to be illegal under international law. Israel disregarded the Court’s decision and continued to build wherever it pleased. It was one of Israel’s many violations of international law that the international community failed to enforce, and it was the last straw.
A year later, on July 9, 2005, Palestinian civil society called for the international community—individuals, organizations, companies, and governments—to boycott, divest from, and sanction Israel until it complies with international law and universal principles of human rights, believing it to be a powerful form of non-violent resistance to injustice.
Amid a growing global effort to heed the call of Palestinian civil society, Jewish Voice for Peace (JVP) is asking TIAA-CREF, one of the largest financial service institutions in the US, to divest from the Israeli occupation. One of the most ambitious divestment campaigns so far, it is not a direct boycott of Israel but rather a call for divestment from five major corporations—three American, one French, and one Israeli—that profit from Israel’s violations of international law.
These violations include building segregated roads and rail systems that entrench violations of international law, constructing illegal settlements on Palestinian land, destroying Palestinian homes as acts of collective punishment or ethnic cleansing, severe daily oppression, and wildly disproportionate attacks that devastate civilian areas and regularly kill women and children.
TIAA-CREF was chosen for three main reasons. First, they care about socially responsible investment. Their motto is “Financial Services for the Greater Good,” and they have a “social choice” account for people who wish to invest only in companies that are certified as being socially responsible. They have already divested from four companies that profited from the genocidal policies in Darfur.
Second, it is huge—the largest fund of its kind in the world. Its holdings in the five targeted companies—Caterpillar, Elbit Systems, Motorola, Veolia, and Northrup Grumman—total more than half a billion dollars. A successful campaign would not only be a heavy financial and public relations burden for these companies, it would also set an important precedent for others to follow.
Finally, TIAA-CREF has 60 offices in the US and 15,000 client institutions in the academic, research, medical, cultural and nonprofit fields. You can find networks of TIAA-CREF participants almost anywhere you go, and each has a voice in where they wish their money to be invested.
It will undoubtedly be a long and arduous campaign, but it is already moving faster than anyone anticipated. JVP publicly announced the campaign and sent a letter to TIAA-CREF earlier this month. A representative got back to them quickly, declining to divest and explaining, “Our responsibility to earn a competitive financial return on the retirement savings entrusted to us by 3.7 million participants obliges us to invest in a diverse line-up of companies across all sectors of the global economy.”
They went on, “We believe that concerns about the situation in the Gaza Strip and the West Bank are best addressed by U.S. foreign policy and lend themselves less to using one’s shareholder status to influence portfolio companies,” and stated that divestment from the Sudan had been in accord with US foreign policy whereas divestment from Israel’s occupation is not.
The arguments they put forth—that the bottom line is more important than social responsibility, and that they will not undertake actions unless they fall in line with US foreign policy—lend themselves to easy repudiation. The first directly contradicts TIAA-CREF’s motto while the second implies that divestment from South African Apartheid was wrong as long as the US government had friendly relations with that government. It effectively neuters the free will and conscience of any individual, organization, or company that disagrees with any aspect of US foreign policy.
JVP never expected them to agree to divestment on the first salvo. But the letter was encouraging in that it arrived so promptly, and that they took the campaign seriously enough to feel the need to justify their investment choices. TIAA-CREF also agreed to meet with representatives of the campaign, including Rebecca Vilkomerson, executive director of Jewish Voice for Peace, Michael Ratner, president of the Center for Constitutional Law, Barbara Harvey of JVP-Detroit, and Valerie Hoenin of the Sisters of Mercy, on July 21.
The meeting took place a day after the CREF annual shareholder’s meeting, in which nearly ninety percent of concerns raised by members revolved around divestment from the occupation, with strong audience support. JVP also delivered 1,300 postcards signed by people who support divestment. The board seemed surprised and impressed by the depth and breadth of the campaign. Not a single audience member voiced opposition to it, which indicates changing tides indeed.
JVP is circulating a petition of support for their campaign, which 15,000 people have already signed. If successful, this campaign, which has barely begun and already has tremendous momentum and support, might be looked back upon as a turning point in the global effort to delegitimize Israel’s occupation.
Pamela Olson was a journalist based in the West Bank for two years and is now living in New York writing a book about her experiences called Fast Times in Palestine.