Harvard denies divestment from Israel
By Judie Jacobson
CAMBRIDGE, Mass. -Yes, Harvard University did make changes to its investment portfolio earlier this year that include the sale of all of its shares in Israeli companies. But, no, says John Longbrake, a spokesman for the venerated university, the sale does not reflect a politically-motivated divestment from Israel.
“The Management Company’s most recent SEC filing details changes in holdings, as is routine, but no change in policy,” read a statement released by Harvard after news of the sale become public, causing concern among Israel’s supporters. “The University has not divested from Israel. Israel was moved from the MSCI, our benchmark in emerging markets, to the EAFE index in May due to its successful growth. Our emerging markets holdings were rebalanced accordingly. We have holdings in developed markets, including Israel , through outside managers in commingled accounts and indexes, which are not reported in the filing in question.”
In other words, says Longbrake, the sale reflects a change in holdings, not in policy. Rather than being politically motivated, it was based purely on economic considerations, which were actually the result of the strength of Israel’s economy, he said.
The Israeli companies whose shares were sold, according to the Israeli business publication “Globes Online.” include: Teva; NICE Systems Ltd., Cellcom Israel Ltd., Check Point Software Technologies, Partner Communications Ltd
Most analysts agree that Harvard’s motivation was practical rather than political. “This is pure economics and I don’t think it was because of the Arab boycott. Harvard did not liquidate its investments in Israeli shares,” Info-Prod Research (Middle East) Ltd. managing director Gil Feiler, and director of the Middle East Business and Economic Research Institute at Interdisciplinary Center Herzliya, told The Media Line, which specializes in coverage of the Middle East. “They didn’t eliminate their investments in Israeli stocks. They still have tens of millions of dollars invested, and if you are going to boycott Israel you sell all your stocks.”
Cellcom CFO Yaacov Heen told The Media Line, “There are some funds which invest only in emerging markets. So Harvard had to sell our stock because Israel is no longer classified as an emerging market and they no longer have the ability to hold this stock within the emerging markets fund. It’s more technical than strategic or an issue against Israel.”
Nonetheless, reports of the sale touched a nerve and ignited an uproar among those on both sides of the issue.
According to Globes, “the sale caused unease among Israeli economic groups, who knew perfectly well that Harvard had not the intention of boycotting Israel.”
On the other hand, groups favoring a boycott of Israel praised the news. A spokesman for Boycott, Divestment, and Sanctions (BDS) for Palestine told The Media Line, “We welcome Harvard’s decision.”
Regardless of the motivation behind the sale, notes TheMedia Line: “There is an active campaign to convince administrators at Harvard, the oldest U.S. institution of higher learning, to divest from Israel.”