Campaign Spotlight: Divestment Campaigns

The BDS movement aims to force investors to divest from companies complicit in the occupation of palestine

Campaigns have long realised that targeting investors is one way of pressuring the companies they are fighting against. Corporate Watch looks at divestment tactics used by FOUR active campaigns

Arms Trade

Anti-militarist activists have called for companies to divest from the arms trade. A lot of work has been done to try to convince investors to divest from companies involved in the manufacture of weapons. For example, the Campaign Against the Arms Trade’s Clean Investment campaign targeted investment by charities, churches and local authorities. Campaigns were also started in universities, calling on them to stop investing in the arms trade.

The campaign had a number of successes, largely with the charitable sector and church investment, but came up against the ‘fiduciary responsibility’ of fund managers when campaigning on local government investment.

Recently, divestment campaigns have focused on Barclays Bank, which has substantial investments in the arms trade. Barclays also performs ‘market-maker’ services for arms company ITT Exelis, which owns Brighton-based EDO MBM.

Barclays is also the only high street bank in the UK with significant direct investments in Israeli companies. Corporate Watch research showed that in 2011 the bank held shares in eight Israeli companies, including one that provides antennae for use in Israeli checkpoints in the West Bank.

Smash EDO, a campaign aimed at shutting down EDO MBM has said arms companies “do not operate in a vacuum but are propped up by the networks of corporations and investors which constitute the global capitalist system which puts profit before peace, greed before people.”

In 2009, a UK-wide anti-militarist campaign was called for against Barclays, with campaigners targeting the bank in Cambridge, Bristol, Plymouth, Hastings, Falmouth, Tunbridge Wells, Wrexham, Brighton and Nottingham. Bank branches were defaced, cash machines glued shut and demonstrations held. One group of activists climbed a hoarding above a Barclays branch in Cambridge and cut out letters several feet high from an advertising hoarding reading “Barclays, $7 billion in the arms trade”. Since then the Target Barclays campaign has held a number of demonstrations outside bank branches, a protest has been held against the bank’s 2012 annual general meeting and a stickering campaign has been waged against Barclays sponsorship of London’s bike-hire scheme.

In 2009 a map was produced showing the locations of the investors in the international arms trade in the city of London, including the Royal Bank of Scotland, HSBC, Prudential, AXA and Aviva. A day of action, held to coincide with the biannual Defence and Security Equipment International (DSEi) arms fair, which was being held in Docklands, saw hundreds of anti-militarists holding a march through the City, throwing shoes at the offices of investors in a gesture of disgust, invading offices and smashing windows.

Many funds that market themselves as ‘ethical’ have policies not to invest in the arms trade. However, these policies often draw a narrow definition of which activities to exclude. For example, the Dutch AP7 fund will not invest in companies involved in bombs or cluster bombs but does not have any policy precluding investment in companies which, for example, supply uniforms or logistical equipment to armies.

Co-operative Asset Management, meanwhile, does not exclude the possibility of investment in armaments companies and instead offers investors the option of investing in “sustainable funds” as an investment decision. The Co-operative Bank states that it “will not finance the manufacture or transfer of armaments to oppressive regimes; or the manufacture or transfer of indiscriminate weapons”.

A representative of The Co-op told Corporate Watch: “For our purposes indiscriminate weapons include cluster munitions, antipersonnel landmines, depleted uranium munitions, incendiary munitions and chemical and biological weapons.” This would not exclude, investment in, for example, companies involved in producing missiles which may be indiscriminately fired at civilian areas.



Last year Corporate Watch published a comprehensive company profile of G4S. The profile included a long list of the company’s major investors.*

The list includes many big investment funds and banks such as BlackRock, Lloyds, HSBC and the Co-operative Bank; governments such as those of Norway, Saudi Arabia, Singapore, the province of Quebec and the states of California and New York; and public sector pension funds such as the West Yorkshire Pension Fund, the Lothian Pension Fund, the Universities Superannuation Scheme, the Teachers Insurance and Annuity Association of America and Kuwait’s Public Institution for Social Security.

Since the company profile was published, a new campaign against the notorious security company has been gathering momentum, in the UK and beyond. Stop G4S is a UK-based coalition of various grassroots activist groups, campaigns, NGOs and trade unionists that have a shared interest in “holding G4S to account for its track record of human rights abuses across the world and in stopping the company from taking over public services or being given any more control over our lives.”

Among other tactics and forms of protest, campaigners have been ‘engaging’ with some of G4S’s institutional investors to try and persuade them to divest from the company. At the top of their list were the ‘soft’ targets – that is, investors who have some sort of ethical or socially responsible guidelines that can be used to persuade them to divest from G4S because the company does not fit their criteria. The most obvious of these seemed to be the Co-operative Bank, which prides itself on having a “strict ethical policy.”

The Co-operative Asset Management, the bank’s investment arm, owns, through NCH Pumpkin, 1% of G4S’s total shares. Back in 2010, the Co-op, prompted by Palestine solidarity campaigners, wrote to G4S advising it that “proximity to human rights violations” deemed its business in Palestine/Israel “unacceptable for our Sustainable Funds” and asked the company to demonstrate how its activities in the Occupied Palestinian Territories could be justified, both against its own human rights policies and the norms endorsed by the UN. G4S issued a statement promising it would, at some point in the future, “exit from certain contracts” it holds in the West Bank involving check points, prisons and police stations. In its 2011 annual report, the Co-op applauded this step, ignoring the fact that G4S did not say anything about its contract with the Israeli prison service, under which it provides services to prisons inside Israel, or its contracts with private businesses based or operating in illegal settlements in the West Bank.

Campaigners were obviously not content with this result and wrote to the Co-op raising these points, but the bank refused to engage with them further, claiming it plans to sell its investment arm to Royal London. In July 2012, however, Co-operative Asset Management confirmed that it had ditched its investment in G4S, saying it had “lost faith in the management” after the debacle over the company’s bungled attempt to purchase rival services firm ISS.

Next on the list was the West Yorkshire Pension Fund (WYPF), which owned, via its funds, G4S shares estimated to be worth almost £8 million as of March 2012. On 26 October 2012, campaigners from South Yorkshire Migration and Asylum Action Group (SYMAAG) and Barnsley Asylum Support Group picketed WYPF’s annual general meeting in Huddersfield, with the call “Do not invest in G4S”. Some 200 leaflets were handed to the AGM attendees, many of whom were apparently not aware that WYPF invested in the company. The leaflet emphasised that the pensions of members, who include local government and fire service workers,and councillors throughout West Yorkshire, were dependent on G4S profiting from other people’s suffering. Although the response from pensioners and members of the WYPF to the picket and the leaflet was, according to protesters, overwhelmingly positive, the fund has not yet decided to divest from G4S.

Other public sector worker pension funds that own shares in G4S include the Lothian Pension Fund, which is one of the largest pension funds in Scotland and manages the pensions of local government employees in Edinburgh and the Lothians area of Scotland. In September 2012, the fund owned around 300,000 ordinary shares in G4S, worth almost £800,000.

It seems investors need a lot of persuasion to get them to divest from a company for ethical reasons rather than financial ones. Campaigners have had better results with local councils and other government bodies across Europe that had, or were planning to have, contracts with G4S, or even with private businesses that deal with it. For example, it only took a few protest letters by customers and campaigners and a low-key Facebook and Twitter campaign to get Good Energy to ditch G4S as its meter reading contractor.**

But the two types of targets are not unrelated: the more contracts G4S loses, or fails to win, the less financially viable it becomes for investors who only care about maximising the returns on their investments.

* The list can be found at

** See for more details


 Animal Rights

The Channel 4 documentary “It’s a Dog’s Life” was shown on TV in 1997. The graphic images of animals being abused at Huntingdon Life Sciences sparked a national outcry and led the UK animal rights movement to turn its attention to the company.

At that time, Huntingdon Life Science PLC (HLS) was a FTSE 100 company, listed on the London Stock Exchange, and worth up to £0.5 billion.

It was one of the largest laboratories in the world, contracted by corporations to test products on animals. Its main base was at Alconbury in Huntingdonshire, with a smaller laboratory in New Jersey.

Fresh from success in shutting down both Consort Kennels, a commercial breeder of beagles for animal testing laboratories, and Hill Grove Farm, the last commercial breeder of cats for laboratories in the UK, the animal rights movement was in a strong position, with plenty of momentum.

Up until then, though, campaigns had focused primarily on particular sites, such as university and corporate laboratories, and small businesses. Taking on HLS required an entire new set of tactics to be developed alongside the traditional protest ones. Various organisations were involved in the new campaign but the principal one was Stop Huntingdon Animal Cruelty (SHAC).

The initial campaign was quite effective. However, as a FTSE 100 company, HLS had access to a lot of financial resources that gave it considerable resilience.

This led campaigners to examine what went into making a FTSE 100 company such as HLS work; not just the animal experiment side, but everything else.

Campaigners soon realised that, in many cases, the ability to raise money was dependent on share prices, as debt could be converted into shares quite easily. If the share price went down, then the company’s ability to raise money would be curtailed. This realisation led to a multi-stage campaign.

Initially the campaign focused on shareholders of every size, from large multinationals to private individual investors. Campaigners wrote to each and every shareholder, informing them of what sort of company they were investing in.

For many of them, this was shocking news that led them to sell their shares. For others, being contacted by activists was sufficient for them to sell. HLS’s share price began to decline in fits and starts, but the trend was downwards overall.

Following this, there was a campaign of naming and shaming the remaining shareholders, which included the Labour party’s pension fund, through protests and leafleting campaigns.

No distinction was drawn between institutional and individual investors. This innovation in tactics garnered large amounts of press coverage, particularly in the financial papers, and it quickly became apparent that HLS’s name was considered among professional investment firms as ‘dirt’ to be avoided, as it brought with it too much trouble.

The next stage was to make all trading in HLS shares next to impossible. This involved targeting small but vital companies known as ‘market makers’, which connect buyers and sellers. One by one, these were picked off until it became almost impossible to trade in HLS shares.

After two years of campaigning at this level, HLS fled the London Stock Exchange for the New York-based NASDAQ, only to be driven off this by US activists. The company then had to move into the ‘over-the-counter’ market, usually seen as the resting place of junk stocks.

Within a couple of years, HLS’s share price had fallen by 5,000% and the company had been forced out of two major stock exchanges. This was in many ways an unparalleled achievement for a campaign. Eventually HLS had to be taken private by its senior executives, who used a loan to buy it out



In 2004, in the wake of the construction of the illegal Israeli apartheid wall on Palestinian land, Palestinians from a broad range of civil society groups called for boycott action from international civil society. The call was a recognition that governments and politicians had failed to take effective action to stop Israeli war crimes against Palestinians and, in many cases, had offered unconditional support to the Israeli state.

The call was for three types of actions: boycott, divestment and sanctions (BDS). The D in BDS calls for campaigns to persuade investors to divest from Israeli companies and companies that are complicit in Israeli apartheid, militarism and colonisation. Divestment has proved one of the more challenging aspects of the BDS campaign but the movement has won some significant victories.

For example, in 2006, ASN Bank divested from French company Veolia over its contracts in the occupied Palestinian territories. ASN has since divested from a number of other companies which are complicit in the occupation.

Danske Bank bowed to BDS pressure in 2010 stating that it did “not want to put customers’ money in companies that violate international standards”.

A successful BDS campaign was waged against Dexia Bank, aimed at persuading it to divest from Dexia Israel, which had made millions of dollars worth of loans for settlement building in the West Bank.

The campaign induced the Belgian-French banking group to make the announcement in 2011 that it would divest its shares even if it incurred a loss. Though Dexia, which is in the process of collapse, has still not divested its share it plans to do so by the end of 2013. The Dexia campaign was international in scope with actions in Turkey, France, Luxembourg and Belgium which persuaded 42 municipalities that invested in Dexia to pass motions calling for divestment.

In 2007 the Church of England announced that it would ditch investments in companies fuelling the illegal occupation of Palestinian territories. In 2012 the US Quaker Friends Fiduciary Corporation (FFC), which held over $200 million in assets, has divested $900,000 in Caterpillar shares.

In 2013 the director of the British agricultural company Valley Grown Salads, that owns a stake in the Israeli company EDOM UK which sources fresh produce from Israel’s settlements, agreed to divest the company’s shares in response to BDS campaigning.

There have been some victories in persuading pension funds to divest from companies complicit in Israeli war crimes. After a campaign by Norwegian activists, the Norwegian state pension fund divested from Elbit, an Israeli arms company. The Swedish AP7 state pension fund, which handles pension savings worth around $15 billion, followed suit in 2010, divesting from a number of companies including Alstom, a company involved in the construction of the Jerusalem Light Rail project on occupied territory.

The response of some funds, however, has been to enter into engagement processes with the companies, rather than divesting. One example is The Co-operative Bank’s strategy to attempt to address concerns raised by campaigners about the Co-operative Asset Management’s investments in G4S, relating to G4S’s provision of services to the Israeli prison service, police, settlements and military checkpoints.

The Co-op’s response was to ‘engage’ with G4S and to point to an internal review by G4S of its activities as a reason why it should not divest. However, the fund did decide to divest all its shares in G4S in July 2012.

Other companies have chosen to divest from companies complicit in the occupation in the case of ‘ethical funds’, but allow other funds to continue investing. For example, US pension fund TIAA-CREF divested over $72 million shares in Caterpillar from its ‘Social Choices’ fund, yet retained shares worth millions in the company in its other portfolios. Crucially, practices like this allow companies to offer ethical investment as a consumer option to investors while continuing with business as usual in their core investment strategy.

Campaigners in the UK are lagging behind a little compared to other campaigners in Europe, in terms of divestment campaigns. Research carried out by Corporate Watch in 2011 showed that a sample of six British pensions funds profiled had extensive investments in companies complicit in Israeli war crimes, as did four British universities.