JTA: Israel cited in Caterpillar’s delisting from influential investment index
Israel cited in Caterpillar’s delisting from influential investment index
by Ron Kampeas for the JTA, 6/22/12
WASHINGTON (JTA) – The sale of Caterpillar tractors to Israel was a factor, but not the determining one, in the delisting of the company from an influential index that prioritizes good governance and human rights.The move, however, is poised to further complicate the difficult ongoing conversation about Israel taking place between American Jewish gruops and the Presbyterian Church (USA).
A senior official at MSCI-ESG, a subdivision of MSCI, Morgan Stanley’s investment advice arm, said Caterpillar already had a low rating before its delisting earlier this year, in part because of its association with the Israeli army’s use of the tractors in the West Bank and past use in the Gaza Strip. The role of Israel’s use of the tractors in the decision also suggests that a sustained campaign by pro-Palestinian groups has had some effect, although officials at MSGI-ESG and one of its clients, the TIAA-CREF pension fund, deny succumbing to direct pressure.
TIAA-CREF’s divestiture amounted to $72 million in funds, dwarfing previous divestitures by liberal religious groups such as Friends Fiduciary, a Quaker group that divested $900,000.
The news of the delisting comes ahead of the biennial general assembly of the Presbyterian Church (USA), where divestment from Caterpillar and other companies selling products used by the Israeli army, will be considered.