A Norwegian sovereign wealth fund is selling shares in Israel’s Bezeq over telecommunications services to Israeli settlements

Norway’s sovereign wealth fund, the world’s largest, has sold all its shares in Israel’s Bezeq, which provides telecommunications services to Israeli settlements in the occupied West Bank.

The decision, announced late Tuesday, comes after the fund’s ethics body, the Ethics Council, adopted a new, stricter definition of ethical standards for businesses that support Israel’s operations in the Palestinian territories.

This $1.8-trillion fund has become an international leader in the field of environmental, social and governance (ESG) investments. It owns 1.5 percent of the world’s listed shares in 8,700 companies, and its size makes it influential.

It is the latest decision by a European financial institution to cut ties with Israeli companies or those with ties to the country, as pressure mounts on foreign governments to end the war in Gaza.

Bezeq, Israel’s largest media group, declined to comment.

“The company, through its physical presence and the provision of telecommunication services in Israeli settlements in the West Bank, is helping to maintain and expand these settlements, which are illegal under international law,” the sovereign wealth fund said in its recommendation. collapse.

“By doing so the company itself is contributing to the violation of international law.”

The Council on Ethics said it noted that the company said it provides communication services in Palestinian areas in the West Bank, but that does not override the fact that it also provides services in Israeli settlements.

The watchdog makes recommendations to Norway’s central bank’s board, which has the final say on spending.

The advice on Bezeq was the first recommendation to back down since the watchdog made its target in August. More decisions are expected.

Divestment impact ‘negligible’

The fund has sold all its stocks in the company. Before that, it had cut its stake in the first quarter of 2024, with 0.76 percent of the company’s shares worth $23.7 million at the end of June, from a holding of 2.2 percent at the beginning of the year, fund data. he showed.

Sources close to the company said the impact of the divestment is “negligible” as it amounts to 0.7 percent of the shares and that the decision is clearly a “political decision.”

They said Bezeq was allowed to provide telecommunications services to Jewish settlements in Area C under the 1994 Oslo Accords – which also called for the Palestinian Authority to establish its own telecommunications network in the Palestinian territories.

“Bezeq operates according to the Oslo accords, so it is a political decision,” said one source. “Of all the companies you have to choose [to divest] since, Bezeq should have been the last.”

In May, Norway recognized Palestine as a state, alongside Spain and Ireland.

Norway acted as a facilitator in the 1992-93 negotiations between Israel and the Palestinian Liberation Organization that led to the Oslo Accords in 1993. Area C, which covers about 60 percent of the West Bank, is under full Israeli control and contains the majority of Israelis. residential areas.

Israeli policies ‘contrary to international law’: watchdog

The Council on Ethics said it is aware of this but “the situation on the ground has developed in a different way than what was envisaged by the Oslo Accords.”

“The settlements are constantly being expanded, the Palestinian people are constantly being pushed out of their homes and the land is taken for granted,” it told Reuters, citing its recommendation. “Relevant discrimination and harassment of Palestinians in Area C is also taking place.”

The fund watchdog’s new definition of ethical violations is based in part on the International Court of Justice’s finding in July that “the occupation itself, Israel’s settlement policy and Israel’s use of natural resources in the territories are in violation of international law,” according to the August letter. 30 which was written to the Ministry of Finance.

Since the start of Israel’s war on Gaza in October 2023, after the terrorist group Hamas attacked southern Israel, the council has been investigating how many companies fall outside the approved investment guidelines.

Before the announcement of the split, the fund was out of nine companies operating in the West Bank.

Their jobs include building roads and homes in Israeli settlements in East Jerusalem and the West Bank, as well as providing surveillance systems for Israel’s wall around the West Bank.