(Image: Getty)
A Scottish council has been urged to pull its funding from two companies with ties to the Israel Defence Forces.
Shetland Island Council has close to £400m tied up in investments, including with a company named by the United Nations special rapporteur as being one of the biggest investors in the "economy of genocide".
A local councillor, whose motion to divest was not adopted by the council, compared the situation to apartheid South Africa, saying the "economic pressure" of the boycott movement is an example to be followed.
Shetland Council has four investment fund managers - BlackRock, Bailie Gifford, IFM Investors, and Partners - which manage an investment portfolio of around £395m.
Two of the four have links to Israel.
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Blackrock is the second biggest individual shareholder in Lockheed Martin, which is a major supplier of the IDF.
The American company is the world's largest weapons manufacturer and supplies Israel with F-16 and F-35 fighter jets, Hellfire missiles and C-130 Hercules transport planes.
Blackrock is the top institutional shareholder in Boeing, which manufactures F-15 fighter jets, Apache AH-64 attack helicopters and bombs used by the IDF.
The world's largest asset manager is the second largest institutional investor in Palantir, Microsoft, Amazon, Alphabet and IBM all of which, along with Boeing and Lockheed Martin, were named in a United Nations report on the "economy of genocide".
That report concluded that Blackrock ranks "among the largest investors in arms companies pivotal to the genocidal arsenal of Israel".
Baillie Gifford is a shareholder in three companies - Airbnb, Booking Holdings and Cemex - which operate in the Occupied Palestinian Territories.
Booking.com has advertised for accommodation in the occupied West Bank, including the former homes of Palestinians forced out by settlers.
Protesters hosted a die-in outside the Baillie Gifford offices in Edinburgh (Image: Newsquest)
A report earlier this year found 41 Booking.com listings in 14 illegal Israeli settlements.
Airbnb similarly offers properties to rent in illegal settlements, including Tekoa where at least 100 Palestinians have been forced out since 2023.
Cemex previously operated factories in the West Bank through a subsidiary and has been accused of supplying materials for barricades and border walls
It also holds stock in Cisco Systems, which provides networking and technology services to the IDF. Blackrock is Cisco's top institutional shareholder.
SIC has said its exposure to Israeli companies through Blackrock is around £322,000 and with Baillie Gifford the total is around £758k due to a holding in Mobileye, which has its headquarters in Jerusalem.
It says that "as far as the Council is aware" it does not have any investments in "non-Israel companies supplying weapons to Israel".
Mobileye is an autonomous driving company. The technology for its self-driving cars is based on vision systems evolved from military drone navigation, with Reuters reporting in 2018 that the nascent autonomous car industry in Israel stemmed from technology which "helped Israel's military drive tanks, guide and intercept missiles".
Tech companies in Israel are heavily staffed by former members of Unit 8200, which the Financial Times described in 2015 as "the equivalent of America's National Security Agency".
Mobileye is no exception, with publicly-available LinkedIn profiles identifying many of its developers as having served with Unit 8200.
A man looks as Palestinians search through the rubble of a building destroyed in an Israeli airstrike late Thursday in the Maghazi camp in the central Gaza Strip (Image: Abdel Kareem Hana/AP Photo)
In 2014, veterans of Unit 8200 signed a public letter alleging that civilians in the occupied Palestinian territories were being subjected to "espionage and surveillance by Israeli intelligence", including the retention of details around sexual preferences, infidelities, financial problems or family illnesses which could be used to "extort/blackmail the person and turn them into a collaborator".
SIC commissioned a report from Isio on its investments, at the cost of £9,500 before VAT, which said no action was needed.
The company describes itself as a 'progressive advisory firm' and is majority owned by private equity group Aquiline Capital Partners which itself invests in Israeli companies Kyron Systems and Five Sigma.
Scottish Greens councillor Alex Armitage said: “In Shetland it’s easy to feel isolated from the rest of the world, but a quick look through our council’s BlackRock and Baillie Gifford investments tells a completely different story.
"For such a small community, we have an outsized influence on the rest of the world, with well over a billion pounds invested across our charitable trust, council reserves and pension fund.
"I feel passionately that we should use the power we have in Shetland through our financial investments to uphold principles of human rights, social and ecological justice.
"Our Norwegian neighbours have recently removed their investments from the Israeli economy, following that country’s policies of racial discrimination, forced displacement and genocide, and I led a motion for Shetland to do the same. I was disappointed not to get more support from councillor colleagues.
"I find it extremely disturbing that our country continues to provide political support to the Israeli government, and that the voices of Palestinians, as well as the voices of a growing number of Jewish people critical of the Israeli government, are falling on deaf ears.
"It was the economic pressure that Britain and others brought to bear on the apartheid government that brought democracy to South Africa in the 1990s and I believe the same strategy should be applied to bring democracy for people in Palestine and Israel.”
Shetland Islands Council said: “We take seriously our environmental, social, and governance responsibilities in respect of our investments, and this is a regular feature of discussions with our fund managers.
"Councillors have previously considered these elements in detail and concluded that our existing investments have exceedingly limited, or nil, exposure to areas that might be considered relevant to BDS activity.”
Other councils in Scotland have direct or indirect exposure to Israel and the Occupied Palestinian Territories.
Borders Council has confirmed its pension fund has around £500k worth of holdings connected Israel via to Baillie Gifford and M&G, as well as around £2.5m in "companies involved with the sale or manufacturing of weapons", though not necessarily to Israel, in a report by Isio.
Many other local government pension funds have investments with Blackrock, Baillie Gifford and M&G including Strathclyde, Dumfries & Galloway, Falkirk, and Fife. That does not necessarily mean investments in Israeli companies or suppliers to the IDF.
Glasgow City Council uses public-space CCTV software originally developed by Israel’s NICE Systems, founded by former members of Unit 8200, though technology to gather biometric data is not currently operational, as a Data Protection Impact Assessment is yet to be completed.
The Scottish Government said: "Scottish Ministers do not have powers to direct local authorities on investment decisions, including requiring councils to divest from particular companies or sectors.
"Accordingly, it is for individual councils to determine their own investment policies and arrangements in accordance with the relevant statutory and regulatory frameworks."