When bad business makes poor policy

Is the Government really prepared to force Councils to procure from and invest in unethical companies with an insecure future?

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When Palestine Solidarity Campaign surveyed candidates ahead of this year’s General Election we didn’t realise what a great response we’d get. Of 650 MPs elected, 297 responded to our survey, including almost half of those Conservatives elected. The vast majority of Conservative MPs who responded agreed that the construction of Israel’s settlements on occupied Palestinian land in the West Bank is illegal and unjustifiable.

Conservative MPs have got this right. This is absolutely consistent with Government policy which has a long standing commitment to oppose settlements as they are against international law and a barrier to a future peace agreement.

So it is really disappointing to read a press release, from Matthew Hancock and Greg Clark MPs, declaring that the UK Government plans to block local councils from divesting in companies complicit with Israel’s occupation and settlements.

They apparently plan to amend the Local Government Pension Scheme to say that boycott, divestment and sanctions (‘BDS’) should only be used where formal legal sanctions, embargoes and restrictions have been put in place by the Government. 

The Cabinet Office Procurement Policy will similarly advise local councils ‘that boycotts in procurement policy are inappropriate, outside where formal legal sanctions, embargoes and restrictions have been put in place by the Government.’

It is clear that this has been proposed to put clear blue water between themselves and the Labour opposition. What appears to have gone unnoticed is that this Party political posturing is putting UK foreign policy at risk.

UK policy in relation to Israel’s illegal colonial settlements is well established. The UK Foreign Office has issued guidance, available on the website, specifically warning companies “…There are ..clear risks related to economic and financial activities in the settlements, and we do not encourage or offer support to such activity.”

“Israeli settlements, according to international law, are built on occupied land and are not recognised as a legitimate part of Israel’s territory”

This is consistent with Organisation for Economic Cooperation and Development (OECD) guidelines which establish that firms ‘should respect human rights in every country in which they operate’. ‘These guidelines aim to help the private sector grow their businesses responsibly by promoting human rights and boosting social development around the world.’

Ethical procurement and investment helps good businesses that support human rights and discourages businesses from unethical business deals.

Unethical business is also risky business, as the UK Government advises:

“Financial transactions, investments, purchases, procurements as well as other economic activities (including in services like tourism) in Israeli settlements or benefiting Israeli settlements, entail legal and economic risks stemming from the fact that the Israeli settlements, according to international law, are built on occupied land and are not recognised as a legitimate part of Israel’s territory.”

Is the Government really prepared to force Councils to procure from and invest in companies with such an unethical and insecure future?

These plans – if enacted - would prevent Councils from supporting pensions divestment campaigns in local Councils in England and Wales, and taking international human rights into account when procuring public services in England.

Forcing Councils to put big business interests ahead of ethics and international law is not only risky and bad business practice, it is a gross interference in local democracy and entirely unjust.

If Margaret Thatcher had been leading Britain’s response to Apartheid South Africa the boycott, divestment and sanctions campaign would never have begun. Politicians often follow rather than lead global justice movements. Repressing citizen led justice campaigns are not the hallmarks of a free, fair and democratic society. Let’s not damage Britain’s reputation for political freedom.

Time for a rethink.