Thinking Anglicans

ethical investment: a roundup

Updated Tuesday

Below is the text of an article by Stephen Bates which appeared under the title A Question of Judgement in The Tablet dated 25 February. It is reproduced here by kind permission of The Tablet.

In the same issue, The Tablet also published a related article, Capital concerns by Brian Griffiths who is vice-chairman of Goldman Sachs and a member of the Church of England.

On Sunday, this profile of John Reynolds chairman of the Church of England’s Ethical Investment Advisory Group (EIAG), appeared in the Observer: Confessions of ethics man.

Last week, the Church Commissioners announced:

Grainger GenInvest and The Church Commissioners have exchanged contracts for the freeholds of 976 predominantly residential properties in Waterloo, Winchester Park, Vauxhall, Pimlico and Walworth. Completion of the sale is expected within the next few weeks.

Thus the sale of the Octavia Hill Estates, which got rather overshadowed by the Caterpillar issue, has now been concluded, whereas nothing at all has happened, and indeed may never happen, about the Caterpillar shares held by church bodies.

Item added Tuesday
Caterpillar: Ethical Investment Advisory Group confirms earlier decision

The Church of England’s Ethical Investment Advisory Group, after careful consideration at a specially convened meeting to discuss Caterpillar Inc – the US-based manufacturer of construction and mining equipment – has unanimously reaffirmed its previous decision, taken in September 2005.

The decision involved: not recommending disinvestment from Caterpillar; continuing its programme of engagement with Caterpillar; and making clear its intention of revisiting this decision if there are new sales of Caterpillar equipment to the Israeli defence forces for use in the demolition of Palestinian houses…

A question of judgement

When Archbishop Rowan Williams raised his hand at the end of a somewhat perfunctory debate in the Church of England General Synod a couple of weeks ago, he can have had little idea what impact his vote would have. His support for a motion calling for the Church Commissioners – managers of the CofE’s £4.3 billion-worth of assets – to disinvest from companies profiting from Israel’s illegal occupation of Palestinian territories – and specifically Caterpillar Inc., the American machinery company whose giant bulldozers have been used to flatten Palestinian homes – has reverberated around the Anglican Communion and damaged relations with Britain’s Jewish community.

The opprobrium meted out to the synod in general and the archbishop in particular has been quite extraordinary, particularly as the event seemed almost akin to a junior common room motion passed at the end of an exhausting meeting. Since then American conservative Episcopalian websites have been full of commentary about the Church of England supporting terrorism, boycotting Israel, and backing Hamas. They have routinely accused Dr Williams of being an anti-Semite.

Lord Carey, Williams’s predecessor as archbishop, described the vote as making him feel ashamed to be an Anglican. Canon Andrew White, the church’s Middle East negotiator, said it was clap-trap. And last Friday, in the cruellest cut of all, the Chief Rabbi, Sir Jonathan Sacks, a man whose congruence with Dr Williams might normally be thought to extend all the way to their matching grey beards, denounced the decision in an article for The Jewish Chronicle as ill-judged and inappropriate.

Then there have been the charges of anti-Semitism from some Jewish quarters while senior churchmen have riposted by claiming criticism of Israeli policies is legitimate and not anti-Jewish. The Revd Paul Oestreicher, himself a German Jew who converted to Christianity, wrote in The Guardian this week that: “I cannot listen calmly when a great many citizens of Israel think and speak of Palestinians in the way a great many Germans thought and spoke about Jews when I was one of them and had to flee … the State of Israel has become a cruel and occupying power.”

This row is certainly the severest strain in Anglican-Jewish relationships for many years. That it has escalated to such an extent says much of the febrility of Middle Eastern affairs and the insecurity and defensiveness of Jews in Britain, no less than Israel. But the central issue as to whether the Church Commissioners, responsible for the Church of England’s money, should invest in an American machinery company one of whose products may be used for purposes of which the church ethically disapproves – has been rather trampled under foot.

The Church’s shares in Caterpillar are worth £2.5 million out of an investment portfolio of more than £950 million. It is financially insignificant: the Caterpillar investment does not even rate a mention in the Church Commissioners’ last annual report, coming way behind at least 80 other corporations, headed by Vodafone in which the church has invested £114 million, or BP in which it has £108 million.

It matters even less to Caterpillar, based in Peoria, Illinois, whose website boasts fourth quarter sales and revenues in 2005 of $9.6 billion – half as much again as the entire assets of the Church of England. Caterpillar boasts of record profits per share – up 40 per cent, equivalent of $1.20 (69p) a share – as a result of its year’s trading, which might be some consolation if the commissioners were actually to sell the Church’s shares.

Not that they are going to do so. A statement issued within two days of the synod vote made clear that the commissioners have no intention of selling: “The resolution is … an advisory one only; a resolution cannot take away from each investment body of the Church its own legal responsibility to take decisions on these matters. Reports that ‘the Church of England has decided to disinvest from Caterpillar’ – let alone to boycott Israel … are wholly untrue,” the commissioners loftily announced.

The disinvestment call did not come out of the blue, even if it surprised many synod members. The charity War on Want has been campaigning for the church to take its money out of Caterpillar for many months.

The company’s giant D9 bulldozers, the size of a bus, are highly visible symbols of the struggle, never mind that Caterpillar contends that it has not sold them, or spare parts, directly to Israel but to the US military, which passed them on several years ago, placing the sales well out of the company’s hands.

Israel itself points out that the D9s were also used against illegal Jewish settlements in Gaza last summer and are mainly employed in more constructive building projects.

In the light of the concern the church’s Ethical Investment Advisory Group, responsible for ensuring the commissioners do not put the church’s money anywhere they shouldn’t, has engaged in talks with Caterpillar for some time.

War on Want organised fringe meetings to keep them up to the mark at the last two synods, in July and November. I was asked to chair the debate at the November synod and such was the pulling power of the issue that just 14 members, including one bishop, turned up.

This month’s debate in synod was not quite so poorly attended, but it took place at the end of a day’s business and lasted less than half an hour. It was far from one-sided – Christopher Herbert, the Bishop of St Albans and chairman of the Council of Christians and Jews, warned the synod that it should not act precipitously. But what clearly made the most impact was the reading out of an impassioned letter from Bishop Riah Hanna Abu El-Assal of Jerusalem, who is himself a Palestinian, supporting a boycott.

There was also a vehement speech from John Gladwin, Bishop of Chelmsford and chairman of Christian Aid, who announced: “The problem is not Caterpillar. The problem is the situation in the Middle East and the Government of Israel.”

What may also have motivated some members was an attack on the Church Commissioners from an entirely different quarter, over their decision to sell off the Octavia Hill housing estates in south London to a private developer. That move had sparked much higher-profile protests than the Caterpillar investment. It was portrayed as the Church turning its back on poor tenants in accommodation run for their benefit since the days of the eponymous Victorian benefactor.

Outside the synod that afternoon local MPs had been protesting and lobbying members, so it was very much in their minds. The sale of the estates was, like the Caterpillar issue, not exactly clear-cut: some of the tenants are by no means any more members of the deserving poor and the commissioners have a responsibility to maximise revenues for the Church.

But the commissioners have been perfunctory in defending their decision to sell and Andreas Whittam Smith, the First Estates Commissioner, who was put up to defend the move appeared both patronising and dismissive. The Octavia Hill sale has netted the church approximately £6 million more than it would have gained by selling to a social housing trust and securing the tenants their homes.

On the Caterpillar row, a number of forces have been at work in fomenting reaction within the Jewish community, not least a understandable fear that, at a time when Hamas is calling for Israel’s very existence to be expunged and with many voices in the west questioning Israeli government policy, now even a reliable source of support was slipping away.

The well-organised email lobbying of Jewish groups in Israel and the US have fuelled further the row, as have the public criticisms of Lord Carey and Canon White, neither of whom attended the synod debate. The Chief rabbi has also wavered. His initial response to Archbishop Williams’s letter of explanation following the initial outrage over the debate was emollient and reassuring. This however was more publicly replaced by his Jewish Chronicle article which stoked the flames at the end of last week.

Sir Jonathan, for all his amiable public profile, has a mixed reputation within the Jewish community for havering on a series of key issues in an attempt to straddle his diverse and often mutually antagonistic community.

When he changed the text of his last book The Dignity of Difference, which speculated that Jews might have something to learn from other faiths, a Jewish bookshop in north London sold copies of the original version under a poster stating: “Buy now before he changes his mind again.”

In last Friday’s Jewish Chronicle article, Sir Jonathan’s suggestion that the Church of England might like to invest in more constructive projects in Palestine if it really wanted to help was overshadowed by his censure of the synod’s temerity. It was, The Jewish Chronicle rightly said, a severe tongue lashing and it will probably do the chief rabbi no harm with many British Jews. The chief victim of this whole affair is Rowan Williams, his authority once again called into question.

He is damned if he sits on the fence and condemned if he slides off it. But at the moment he must wish that, like John Sentamu, the Archbishop of York, sitting beside him, he’d kept his hand in his pocket for the synod vote.

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Cheryl Clough
Cheryl Clough
18 years ago

There will be some people who will be rightfully annoyed if I don’t make a comment. I am grateful that John Reynolds acknowledges the conflicting sensibilities associated with the Caterpillar shares. It was good to see a public comment that acknowledges that neither the Israelites nor the Palestinians are above approach, whilst at the same time both sides have legitimate grievances and/or fears.

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