Guardian:
Norway wealth fund sells Caterpillar stake over Israel allegations
World’s largest wealth fund says it has excluded bulldozer maker and five Israeli banking groups on ethics grounds
Mark Sweney
Tue 26 Aug 2025 20.26 AEST
An Israeli contractor’s Caterpillar excavator in the West Bank village of Az-Zawiya on 1 July 2004 Photograph: David Silverman/Getty Images
The world’s largest wealth fund has excluded Caterpillar, the construction equipment manufacturer, over Israel’s use of its bulldozers to destroy Palestinian property in Gaza and the West Bank.
Norway’s $2tn (£1.5tn) fund said on Monday it had excluded Caterpillar and five Israeli banking groups on ethics grounds.
While the fund has already excluded more than 20 Israeli companies this year, Caterpillar is the first big US company to be removed through the wealth fund’s ongoing review to ensure its investments do not contribute to violations of international law.
“There is no doubt that Caterpillar’s products are being used to commit extensive and systematic violations of international humanitarian law,” said the fund’s independent council on ethics.
It added that the machinery was “being used by Israeli authorities in the widespread unlawful destruction of Palestinian property”.
The violations were taking place in Gaza and the West Bank, the council said, adding that “the company has also not implemented any measures to prevent such use”.
“As deliveries of the relevant machinery to Israel are now set to resume, the council considers there to be an unacceptable risk that Caterpillar is contributing to serious violations of individuals’ rights in war or conflict situations,” it said.
The fund said had not independently assessed all aspects of the recommendations but found them sufficiently substantiated that the criteria for exclusion have been fulfilled.
Earlier this month, the executive board of the Norges Bank, which manages the fund, said it had decided to exclude six companies with connections to the West Bank and Gaza, and would name them once it had finished selling its stakes.
Norges Bank Investment Management (NBIM) held $2.1bn (£1.6bn) of shares in Caterpillar, about 1.2% of all shares issued, as of 30 June, which made it the company’s eighth-largest shareholder.
The fund also excluded First International Bank of Israel, Bank Leumi Le-Israel, Mizrahi Tefahot Bank, Fibi Holdings and Bank Hapoalim, because of the five banks’ financing of construction activities “that contribute to the maintenance of Israeli settlements”, the council said in its recommendation.
The fund said that the six groups were being excluded “due to an unacceptable risk that the companies contribute to serious violations of the rights of individuals in situations of war and conflict”.
The total value of the divestments being made by the fund is close to $3bn.
Last year, the United Nations’ top court found that Israeli settlements built on territory occupied in 1967 were illegal, a ruling that Israel called “fundamentally wrong”, citing historical and biblical ties to the land.
An Israeli contractor’s Caterpillar excavator in the West Bank village of Az-Zawiya on 1 July 2004 Photograph: David Silverman/Getty Images
The world’s largest wealth fund has excluded Caterpillar, the construction equipment manufacturer, over Israel’s use of its bulldozers to destroy Palestinian property in Gaza and the West Bank.
Norway’s $2tn (£1.5tn) fund said on Monday it had excluded Caterpillar and five Israeli banking groups on ethics grounds.
While the fund has already excluded more than 20 Israeli companies this year, Caterpillar is the first big US company to be removed through the wealth fund’s ongoing review to ensure its investments do not contribute to violations of international law.
“There is no doubt that Caterpillar’s products are being used to commit extensive and systematic violations of international humanitarian law,” said the fund’s independent council on ethics.
It added that the machinery was “being used by Israeli authorities in the widespread unlawful destruction of Palestinian property”.
The violations were taking place in Gaza and the West Bank, the council said, adding that “the company has also not implemented any measures to prevent such use”.
“As deliveries of the relevant machinery to Israel are now set to resume, the council considers there to be an unacceptable risk that Caterpillar is contributing to serious violations of individuals’ rights in war or conflict situations,” it said.
The fund said had not independently assessed all aspects of the recommendations but found them sufficiently substantiated that the criteria for exclusion have been fulfilled.
Earlier this month, the executive board of the Norges Bank, which manages the fund, said it had decided to exclude six companies with connections to the West Bank and Gaza, and would name them once it had finished selling its stakes.
Norges Bank Investment Management (NBIM) held $2.1bn (£1.6bn) of shares in Caterpillar, about 1.2% of all shares issued, as of 30 June, which made it the company’s eighth-largest shareholder.
The fund also excluded First International Bank of Israel, Bank Leumi Le-Israel, Mizrahi Tefahot Bank, Fibi Holdings and Bank Hapoalim, because of the five banks’ financing of construction activities “that contribute to the maintenance of Israeli settlements”, the council said in its recommendation.
The fund said that the six groups were being excluded “due to an unacceptable risk that the companies contribute to serious violations of the rights of individuals in situations of war and conflict”.
The total value of the divestments being made by the fund is close to $3bn.
Last year, the United Nations’ top court found that Israeli settlements built on territory occupied in 1967 were illegal, a ruling that Israel called “fundamentally wrong”, citing historical and biblical ties to the land.
NBIM, which owns about 1.5% of the world’s listed stocks, operates on a mandate set by Norway’s parliament with ethical guidelines.
It is advised by an external ethics council, a public body set up by Norway’s ministry of finance, which regularly assesses its portfolio of holdings and recommends companies for observation or exclusion.
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