General Board of Pensions Response to Divestment Requests

General Conference 2012
The request for divestment from three companies identified by many organizations working to end the military occupation of Palestinian land was presented at General Conference 2012 by The General Board of Global Ministries (GBGM), The General Board of Church and Society (GBCS), seven ethnic caucuses, and four annual conferences, and was supported by United Methodist missionaries serving in the region.

Divestment and issues related to Israel/Palestine were debated for two hours at General Conference 2012, giving this topic more time on the floor than any other social issue.

While a request for a boycott on products and services related to the military occupation of Palestinian land was approved, efforts to divest of Caterpillar, HP, and Motorola Solutions were not approved.  The General Board of Pensions and Health Benefits (GBPHB) and their investing arm, Wespath, indicated they preferred to study the issue and make their own decisions regarding investments.

General Board of Pensions and Health Benefits Meeting with Susquehanna Conference Task Force – April 2014
The Susquehanna Conference Board of Pensions holds funds with GBPHB/Wespath. When the Conference Divestment Task Force began its work, Wespath’s Chief Investment Officer met with the Task Force to share the following:

  • They strive to avoid investments in companies that generate more than 10% of revenue from alcoholic beverages, tobacco products, adult entertainment, weapons, gambling and privately-owned correctional facilities.
  • They strive to balance fiduciary responsibility with concern for human rights. While they have divested in the past (from South Africa, from the Sudan, and from private prisons), and while it is mentioned in The Book of Discipline along with shareholder advocacy as an action they can take, divestment typically is used as a last resort.
  • The General Secretary of GBPHB and the Chief Investment Officer traveled to Israel/Palestine in the fall of 2012 to examine the situation.   
  • A Human Rights and Investment Ethics Task Force (HRIE) brought together key participants from four general boards and agencies to further discuss how best to answer the call of United Methodists to avoid investments that may be in conflict with our United Methodist Social Principles and The Book of Resolutions. The HRIE report led to the formation of a working group of the general secretaries who continue to meet.
  • They are developing a new fund in response to requests across the denomination from those who desire stronger human rights and environmental criteria.


G4S Divestment – June 2014
After a member of the Susquehanna Conference Task Force and others pointed out that G4S, a British security firm, was involved in Israeli prisons where Palestinian prisoners, including children, were reportedly mistreated, GBPHB met with the company to investigate the percentage of revenue received from prison management. GBPHB divested their stock in G4S in June 2014.

Conference on Palestinian Christians August 2014
Representatives of GBPHB, GBGM, and GBCS participated in an August 2014 conference called “Walking with Palestinian Christians in Holy Justice and Peace” at Ginghamsburg Church in Ohio. Missionaries and others at that event advocated for divestment, claiming the United Methodist Church should align their investments with their social stand opposing the military occupation of Palestinian land and opposing settlements.

New Investment Fund with Additional Human Rights Criteria Initiated January 2015
A new fund, an alternative for those who prefer additional criteria focused on human rights and/or the environmental practices, was made available in January 2015 for individual and institutional investors. The Equity Social Values Plus Fund is based on a blend of two Morgan Stanley Capital International (MSCI) Environment, Social and Governance (ESG) indexes. The fund excludes the same companies selling products and services not aligned with the Social Principles that are screened from other GBPHB funds. In addition, MSCI ESG Research, an internationally recognized expert in evaluating corporate environmental, social and governance policies and practices and the provider of the MSCI World Custom ESG Special Weighted Index, identifies companies with highly rated sustainable policies and practices for inclusion in the performance benchmark. Caterpillar, Hewlett Packard and General Electric are not included in the new fund; however, Motorola Solutions is included.  This new fund represents $46.5 million of Pensions’ $21 billion portfolio.

New GBPHB Human Rights Guideline Announced January 2015
A new Human Rights guideline for investments was announced  early in 2015. (At the same time they also announced a Climate Change guideline.

This announcement was covered in the Wall Street Journal

United Methodist News Service carried the story as well. 

The Human Rights guideline does not establish a human rights screen.  It addresses human rights concerns through public policy and corporate engagement, proxy voting and the filing of shareholder resolutions. However, when it is determined that human rights represents excessive investment risk, certian companies and sovereign debt instruments may be exclded. During 2015 they will evaluate the human rights policies of their 100 largest holdings to determine if their policies are in alignment with the United Nations Guiding Principles on Business and Human Rights.  Although Motorola Solutions is not one of their top holdings, they expect to add them to the engagement list.

Investments in Palestine
The General Board's investments team is actively pursuing investment opportunities in the Palestine territories. In 2014, staff traveled to the area to conduct due diligence on projects under consideration.


Below are related links on the website of the General Board of Pensions and Health Benefits to their statements on sustainable investment and other general practices.

Sustainable Investment
http://www.gbophb.org/si/

Human Rights
http://www.gbophb.org/humanrights/

Company Descriptions - Dialogue
http://www.gbophb.org/investments/resources/company-descriptions/

Corporate Engagement
http://www.gbophb.org/sri/corporate-engagement/

Portfolio Screening Guidelines
http://www.gbophb.org/investments/funds/portfolio-screening-guidelines/

Investment Solutions that Benefit All
https://www.wespath.com/assets/1/7/4689.pdf