"College protestors rally around the call for divestment from Israel."

The campaign is expected to have minimal impact on both the companies and Israel. However, activists perceive divestment as a straightforward method to compel colleges to address the issue.

Gathering near the secured gates of Columbia University in Upper Manhattan on Tuesday, approximately one hundred protestors commenced chanting: “Disclose, divest, we will not cease, we will not relent.”

"‘Divest’ is a recurring demand, appearing on banners, in editorials of student newspapers, and amidst rallies spreading across campuses currently immersed in a surge of pro-Palestinian activism."

The interpretation of "divest" has shown variance in scope and specificity. At Yale and Cornell, students urged the universities to cease investments in weapons manufacturers. Meanwhile, Columbia students are advocating for the liquidation of assets in funds and businesses allegedly benefiting from Israel's Gaza invasion and the prolonged occupation of Palestinian territories. This includes companies like Google, engaged in significant contracts with the Israeli government, and Airbnb, facilitating listings in Israeli settlements within the occupied West Bank.

Experts suggest that any potential divestment's impact on both businesses and Israel would likely be minimal. Moreover, they note that if universities relinquish their voting rights as shareholders in these companies, divestment could even prove counterproductive in exerting pressure on companies to alter their practices.

Thus far, universities have resisted calls for divestment. Advocates for Israel argue that these appeals are unjust to a nation facing threats of attack and are anti-Semitic as they single out the world's only Jewish-majority country. This accusation has long been leveled against the "boycott, divestment, sanctions" movement aimed at the nation.

However, many pro-Palestinian activists, including a significant number who are Jewish themselves, view divestment as a distinct and attainable method to compel colleges to address the issue. They perceive it as a significant symbolic triumph that would also heighten awareness of their grievances. These activists point to past successes, such as how students in the 1980s pressured their universities to divest from firms operating in apartheid-era South Africa, as well as from fossil fuel companies.

"Primarily, our aim is to influence Columbia University, as that is within our sphere of influence," stated Ray Guerrero, a graduate student at Columbia's School of Public Health and an organizer with Columbia University Apartheid Divest, a student-led movement. "However, we also aspire for broader impact, hoping these companies comprehend the implications of their actions."

South Africa serves as a precedent.

The universities subject to these appeals possess vast endowments, amounting to billions of dollars, which are allocated across financial markets, including stocks, real estate, and major investment funds.

In simple terms, divesting involves selling assets, typically those deemed objectionable.

An example frequently referenced occurred in the 1980s, focusing on companies conducting business with South Africa during its apartheid era. Columbia University gained attention when it divested $39 million worth of stock held in companies like Coca-Cola, Ford Motor, and Mobil Oil, following weeks of sit-in protests by students on its campus.

Other universities followed suit. In total, over 150 educational institutions divested from companies engaged in business operations in South Africa, contributing to a mosaic of sanctions imposed on the country.

Contemporary students draw parallels between the actions of the Israeli government in Gaza and the occupied West Bank.

Ariela Rosenzweig, a senior at Brown University advocating for the school to divest from companies linked to Israel, expressed her aspiration that the movement would catalyze a ripple effect, prompting not only universities but also other sectors of society to withdraw their support for Israel.

"I'm a part of this community, and I oppose this community benefiting from apartheid, warfare, or genocide," she stated, referencing Brown University.

 

However, in contrast to the 1980s, universities now exercise less direct control over their investments. Instead, they rely on asset managers to oversee portfolios, which are increasingly diversified into private equity and hedge funds. Additionally, some university administrators have highlighted that very little, if any, of their endowments are actively invested in companies potentially linked to Israel. "We are not actively or directly investing in any weapons manufacturers, arms manufacturers, or defense contractors," stated Jane Dietze, Brown's Chief Investment Officer, during a November town hall, as reported by The Brown Daily Herald.

A broad array of companies are under scrutiny.

Last week, The Cornell Daily Sun endorsed the calls for the university to divest from arms manufacturers directly involved in Israel’s campaign. "Cornell should in no way support a war that has been waged with callous disregard for civilian lives," the paper wrote. In contrast, at Columbia, students are advocating for divestment from stakes in several companies that are not directly involved in warfare, including Caterpillar, Google, and Airbnb. Caterpillar's ties to Israel have been under scrutiny for decades, especially after an incident in 2003 when an armored bulldozer manufactured by the company for the Israeli military ran over and killed the American pro-Palestinian activist Rachel Corrie as she tried to halt the demolition of Palestinian homes in Gaza. Google has faced protests from some employees over a contract with the Israeli government for cloud services, while Airbnb is included on the list because it has provided listings to visitors in Israeli settlements in the occupied West Bank, which are considered illegal by many nations.

However, the amount of money targeted represents a small fraction of the publicly known endowments. The investments listed by Columbia University Apartheid Divest as objectionable amount to less than one-tenth of 1 percent of Columbia’s $13.6 billion endowment. Students are also demanding greater transparency from the university regarding its private holdings to gain a better understanding of its overall investment in Israel.

Also on the list is an investor with more transparent holdings: BlackRock, the world’s largest asset manager, which owns shares of nearly every publicly traded company through its exchange-traded funds. Activists at the University of California, Berkeley, and Columbia have pointed to the asset manager’s holdings in weapons manufacturers as reasons to divest from its funds. According to the website Weapon Free Funds, which urges investors to divest from weapons stocks, only about 3 percent of BlackRock’s Core S&P 500 ETF is invested in "military contractors," including Raytheon and Boeing. Caterpillar, Google, and Airbnb did not respond to requests for comment, while BlackRock declined to comment.

Is divestment effective?

The effectiveness of divestment hinges on its definition of success. Witold Henisz, vice dean and faculty head of the environmental, social, and governance initiative at Wharton Business School, suggests that if the aim of divestment is to achieve a specific social objective by influencing company conduct, it may fall short. Research indicates minimal to no impact of university divestments on firm behavior. Henisz highlights that when a university sells its stake in a company based on values, the buyer may not prioritize the issue as much, thus reducing pressure on the company to alter its practices. However, if divestment is viewed more broadly as part of a collective effort to catalyze change, it could prove successful. Mobilizing a movement and expressing moral outrage can be effective strategies within campaigns. Nevertheless, pro-Palestinian activists argue that divestment aims not only to end institutional complicity in atrocities but also to prompt corporate behavior change. Vayne Ong, a second-year doctoral student in history at Columbia University, questions why any investment linked to genocide should exist, suggesting a need for complete divestment regardless of its financial impact.

Universities remain steadfast for now.

Thus far, universities have staunchly resisted adjusting their investment portfolios in response to student pressure. While some administrators have engaged with students advocating for divestment, the prevailing stance has been a refusal to modify their holdings or divest from assets associated with Israel. Yale, for instance, recently stated that it would not divest from weapons manufacturers as it did not meet the threshold of significant social harm required for divestment, according to the school’s Corporation Committee on Investor Responsibility (CCIR). Despite offers for dialogues with trustees, discussions collapsed. Similarly, Michigan State's Board of Trustees recently declared its stance against divestment, while other institutions like the University of Michigan and American University have also declined divestment from Israel. Students have submitted divestment proposals to organizations like Yale's CCIR, but the ultimate decision rests with university boards and presidents. At Brown University, a committee recommended divestment from certain companies profiting from human rights abuses in Palestine in 2020, yet the university president, Christina Paxson, opted not to advance the proposal.