Norway’s Wealth Fund Dumps Caterpillar, Israeli Banks Over Rights Concerns
OSLO – Norway’s $1.6 trillion sovereign wealth fund has pulled its investments from U.S. machinery giant Caterpillar and five Israeli banks, citing what it called an “unacceptable risk” of involvement in human rights violations linked to the war in Gaza and Israeli settlement activity.
The decision, announced late Monday when markets were closed, affects Bank Hapoalim, Bank Leumi, Mizrahi Tefahot, First International Bank of Israel, and FIBI Holdings. Together, the fund’s stakes in the banks were worth about $661 million as of June 30. Its Caterpillar holding was valued at $2.1 billion, or roughly 1.17% of the company.
The move follows recommendations from the fund’s Council on Ethics, which argued that Caterpillar bulldozers had been used by Israeli authorities in the unlawful demolition of Palestinian property in Gaza and the West Bank. The council said the company had taken no steps to prevent such use, warning that deliveries of heavy machinery to Israel were set to resume.
“In the council’s assessment, there is no doubt that Caterpillar’s products are being used to commit extensive and systematic violations of international humanitarian law,” the watchdog said.
The banks, meanwhile, were excluded over their role in financing construction projects in Israeli settlements, which the UN’s top court has deemed illegal under international law. The council said the banks had “contributed to the maintenance of Israeli settlements” by providing crucial financial services, including mortgages for settlers.
Israel disputes the UN ruling, pointing to historical and religious ties to the land. Around 700,000 Israelis currently live in settlements across the West Bank and East Jerusalem, alongside 2.7 million Palestinians.
Neither the Israeli embassy in Oslo nor the companies involved responded to requests for comment.
Despite the divestment, Israeli bank shares climbed on Tuesday. FIBI Holdings jumped 4%, Hapoalim rose 3.3%, and Bank Leumi, Mizrahi Tefahot, and First International added between 1.8% and 2.8%. Caterpillar shares dipped 0.4% in pre-market trading, trading at $430.61.
Norway’s sovereign wealth fund, the world’s largest, is invested in more than 8,000 companies globally. It has a long history of excluding firms over ethical concerns, including ties to weapons, coal, and human rights violations. The central bank’s executive board has the final word on exclusions based on recommendations from the Council on Ethics.
The fund first announced on August 18 that it would divest from six companies over concerns related to Gaza and West Bank developments, but withheld names until its holdings were sold.
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