June 16, 2024
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June 16, 2024
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NJ Investment Laws Police State Pension Fund

New calls to cut ties to Ben & Jerry’s would add to list of banned investments.

Earlier this year, state lawmakers received a lengthy report from New Jersey’s public-worker pension fund that exhaustively documented its ties to companies doing business in Northern Ireland. The report must be drafted every year to ensure compliance with a long-standing state law that was enacted decades ago as a response to alleged anti-Catholic labor policies.

Lawmakers also receive several other detailed reports from the pension fund each year, tracking investment activities involving companies doing business in other countries such as Iran, Israel and Sudan.

In many cases, the same set of New Jersey laws that require those reports on foreign investments can also force the state’s pension-fund managers to eventually discard investments, even if still profitable. That is to make sure New Jersey’s assets aren’t being used to support activities for which investments have previously been banned, such as investment ties to Iran’s government over concerns about its nuclear program, and to Sudan’s government in response to concerns about ethnic cleansing in Sudan’s Darfur region.

And while the last such law was passed in New Jersey in 2016, lawmakers and pension-fund managers in more recent years have been facing pressure to enact new sets of so-called divestment measures.

The earlier law requires the annual drafting of a compliance report, but stops short of forcing pension-fund managers to shed any of the investments documented in those reports. But divestment can be required by New Jersey’s more recent investment laws, such as the one passed by the legislature five years ago as a response to a movement that uses economic boycotts to protest Israel’s treatment of Palestinians, both in Israel and in territories it has occupied since 1967.

The 2016 law says New Jersey is “committed to supporting Israel” and requires the state to use an outside research firm to routinely identify companies that boycott Israel in alignment with what’s known as the BDS (Boycott, Divestment, Sanctions) movement.

Some are now questioning whether a recent decision by Vermont-based ice-cream maker Ben & Jerry’s to stop selling products in the Israeli-occupied territories could also trigger the anti-BDS law. The ice-cream company is an independent subsidiary of London-based Unilever, which is a publicly traded company with facilities in Englewood Cliffs.

“The Division of Investment is aware of the situation and is working to determine whether any actions must be taken to ensure continued compliance with the state’s anti-BDS law,” Sciortino said.

Despite ending sales in the occupied territories, Ben & Jerry’s said in a statement that it has no plans to stop doing business altogether in Israel. The company’s founders—who no longer have operational control—also wrote in a recent New York Times op-ed that they support the move.

“The decision to halt sales outside Israel’s democratic borders is not a boycott of Israel,” wrote Bennett Cohen and Jerry Greenfield, who identified themselves as “proud Jews” in the op-ed.

“The company’s stated decision to more fully align its operations with its values is not a rejection of Israel. It is a rejection of Israeli policy, which perpetuates an illegal occupation that is a barrier to peace and violates the basic human rights of the Palestinian people who live under the occupation,” they wrote.

Even when one of New Jersey’s investment bans is flagged in one of the reports, immediate divestment is not required by law.

For example, language in the 2016 law signed by former Republican Gov. Chris Christie says the divestment requirement “shall not be construed to require the premature or otherwise imprudent sale, redemption, divestment, or withdrawal” of any current investment. Instead, the law goes on to say that any such “sale, redemption, divestment, or withdrawal shall be completed not later than 24 months following the effective date of this act.”

The laws policing investment ties to the governments of Sudan and Iran, which were enacted in 2005 and 2007 respectively, established a three-year deadline for action.

John Reitmeyer has covered state and local government in New Jersey for more than 20 years, and for the last five years with NJ Spotlight News. He primarily focuses on issues related to the state budget, taxes and public finance. Prior to joining NJ Spotlight News, Reitmeyer wrote for The Record of Bergen County, The Burlington County Times and The Press of Atlantic City.

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