Dutch Pension Funds Ditch Israeli Investments Over Human Rights Concerns

Dutch pension fund PME has exited investments in companies exposed to the Palestinian territories, citing potential ties to human rights violations. The fund has a $177 million holding in Booking Holdings, Cemex, and Motorola Solutions. This move reflects growing unease among asset owners and managers about contributing to Israeli settlements and the Gaza war. Other investors, including Norway's sovereign wealth fund, have also taken similar actions.

Dutch pension fund PME, with $68 billion in assets, has announced it has exited investments in several companies exposed to the Palestinian territories, citing potential ties to human rights violations. The move follows an extensive due diligence process and engagement that took several months, according to a PME spokesperson. The companies include US-based online travel company Booking Holdings Inc., cement maker Cemex SAB de CV, and Motorola Solutions Inc., a communications equipment provider. The total holding, valued at €151 million ($177 million) at the end of June, was divested Dutch Pension Funds Are Latest Investors to Cut Israel Risk^[2].

This decision reflects growing unease among some asset owners and managers about their investments potentially contributing to the establishment and maintenance of Israeli settlements in the West Bank and the ongoing war in Gaza. Since Hamas attacked Israel on October 7, 2023, more than 66,000 Palestinians have been killed, according to the Hamas-run health ministry. US President Donald Trump has been pushing for a peace deal, with negotiators set to meet in Egypt to conduct talks Dutch Pension Funds Are Latest Investors to Cut Israel Risk^[2].

The divestments come as part of a broader trend among investors to reassess their exposure to high-risk and conflict-affected areas. Norway’s $2 trillion sovereign wealth fund, for instance, placed Caterpillar Inc. on its exclusion list due to Israel’s use of its bulldozers to destroy Palestinian property in Gaza and the West Bank. Similarly, the Netherlands-based ABP, Europe’s biggest pension fund, sold its equity stake in Caterpillar Inc. Dutch Pension Funds Are Latest Investors to Cut Israel Risk^[2].

The move by PME is significant as it adds to the growing list of investors who are reassessing their investments in the region. The United Nations has named 158 companies operating in West Bank settlements at high risk of human rights violations, including building demolition and construction equipment makers Dutch Pension Funds Are Latest Investors to Cut Israel Risk^[2].

This trend highlights the increasing importance of human rights considerations in investment decisions. It also underscores the potential legal risks for financial firms that do not cut their exposure to conflict-affected areas. BNP Paribas SA, for example, has faced a lawsuit filed by the French nonprofit, Lawyers for Respect for International Law, alleging it violated France’s duty of vigilance law by failing to disclose activities that support Israeli settlements Dutch Pension Funds Are Latest Investors to Cut Israel Risk^[2].

As the situation in the Middle East remains volatile, investors are increasingly concerned about the financial material risks associated with their investments. This trend is likely to continue as more asset owners and managers reassess their exposure to the region.