Soros Fund Management, the
family office of the billionaire
investor George Soros, has sold
its stake in SodaStream, the soda
making appliance producer that
profits from the Israeli
occupation of Palestinian
territories and was made
popular by actress Scarlett
Johanssons endorsement.
The decision comes as a number
of big international investors,
including the fund linked to the
Microsoft founder Bill Gates, join
in a burgeoning financial boycott
of Israel amid a push by the
boycott, divestment and
sanctions (BDS) movement and
other groups seeking more
rights for Palestinians.
SodaStream, headquartered in
the Israeli city of Lod, has its
main factory in the West Bank
settlement of Maale Adumim.
Soros Fund Management does
not own shares of SodaStream,
Michael Vachon, a spokesman for
the fund, told The National,
declining to comment further on
when and why it sold the shares.
In a May filing with the US
markets regulator, the fund said
it had bought 550,000 shares of
SodaStream during the first
quarter. Bloomberg reported that
the fund acquired the shares for
$24.3 million, with the new
holding making up 0.3 per cent
of the funds $9.3 billion stock
portfolio.
After pressure from Soros
partners in the region and the
world, they dropped SodaStream
and promised, in private letters
so far, to issue guidelines similar
to those adopted by the EU to
prevent any investment into
companies that sustain the
Israeli occupation and
settlements in particular, said
Omar Barghouti, the Palestinian
activist and co-founder of the
BDS movement.
Several western investors said
earlier this year that they had
sold off holdings in companies
that make money from business
in occupied territories. Norways
$810bn sovereign wealth fund,
the worlds largest, a Dutch
pension fund, and the
Presbyterian Church in the US are
among those that have excluded
some Israeli and US companies
from their portfolios this year.
The companies operate in the
occupied territories, where
settlements built by Israel have
been deemed illegal by the UN
Security Council and the
International Court of Justice
among others.
Financial and economic boycotts
have been tried before, most
notably when Saudi Arabia and
other Opec members stopped
selling oil to the West in 1973 in
reaction to the support given by
the US and other nations to Israel
during its war with Egypt.
But with the 1979 peace
agreement that heralded a
political and economic
rapprochement with Egypt and
eventually other Arab nations, the
momentum fizzled away.
It is only in the past decade that
there has been a revival of the
boycott movement looking to
end the Israeli occupation of land
captured during the 1967 Arab-
Israeli war, allow Palestinians
refugees to return home and end
discrimination against
Palestinians.
Analysts say that as the two-state
solution the framework in
which peace negotiations have
been undertaken for the past
two decades flounders, a
growing anti-apartheid
movement is filling its shoes.
This year has been a strong one
for BDS. The Gates Foundation
Asset Trust, which manages
investments for the $40bn Bill
and Melinda Gates Foundation,
said in June that it sold its stake
in the UK security services firm
G4S, one of the companies
targetted by BDS. The movement
has also been in focus during the
Israeli assault on Gaza and the
widespread anti-war protests
against the killing of hundreds
there.
Earlier this year, Israels finance
minister acknowledged the
impact that a European-wide
boycott could have on the
country, depriving the economy
of $5.7bn and putting almost
10,000 people out of work
immediately. The prime minister
Benjamin Netanyahu has also
acknowledged the threat posed
by BDS. In a March speech in the
US, Mr Netanyahu launched an
attack on the movement,
branding them as racists.
In America, BDS has really
started to pick up in the last year,
and there are a couple of other
examples apart from the
Presbyterian church, such as
universities that have taken
positions against Israel, said
Andrew Hammond, a Middle East
analyst at the European Council
on Foreign Relations. The whole
movement is picking up not so
much because the BDS
movement is so powerful, but
because people want Israel to
come to a peace agreement.
In January, Norways sovereign
wealth fund decided to ban
Africa Israel Investments (AFI
Group) and its subsidiary Danya
Cebus from its portfolio because
of their involvement in building
settlements in the West Bank.
In the same month PGGM, the
second-largest Dutch pension
fund, which manages more than
$200bn in assets, said it had
liquidated holdings in five Israeli
banks for their role in financing
settlement building.
In June, the US Presbyterian
church said that it excluded three
companies Caterpillar, Hewlett-
Packard, and Motorola from its
investment portfolios because
they were used by the Israeli
government in the occupied
territories and were not in
compliance with its policy on
socially responsible investing.
Norway is one of the few
countries that have an ethics
oversight council to review
investments made by its
sovereign wealth fund. In
January, the finance minister, on
advice from the council, told its
sovereign wealth fund to sell its
holdings in AFI Group and Danya
Cebus.
Since the outbreak of fresh
violence in Gaza, there have been
no new announcements of
boycotts by big investors, but
funds such as Norways are
constantly reviewing their
investments according to the
ethics council that monitors its
holdings.
We cannot comment on
companies or cases that we are
working on presently, said Pia
Goyer, senior adviser at the
secretariat of the ethics council
to Norways government pension
fund. You have to wait until we
issue a recommendation. It takes
some time to get all the facts on
the table, the involvement of a
company in any particular
situation. The council only meets
once a month and discusses
what we should proceed with.
Lisa Stonestreet, the programme
director at the London-based UK
Sustainable Investment and
Finance Association, a non-
government trade body that
promotes sustainable
investment, said that institutional
investors were increasingly
focused on ethical factors.
First of all there is a public
demand for it in terms of people
calling into account larger
organisations across the board
to look at what the impact is in
terms of sustainability, in terms
of what the impact is and social
issues, she said. For some
investors, the main aspect is
profitability.
The Canadian Pension Plan
Investment Board, which
manages more than $200bn, has
investments in a number of
Israeli companies, including
SodaStream and Bank Halpolim,
as part of its foreign portfolio of
stocks. Those holdings were part
of its indexing investment
strategy and the fund had no
plans to sell them as it focused
only on potential for profit, said
its spokeswoman, Linda Sims.
mkassem@thenational.ae
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