The Harvard Divestment Scare

The Harvard Divestment Scare

At first it appeared that a pro-Palestinian group had succeeded in convincing another American university to end investments in Israel. And it wasn’t just any university. It was Harvard, no less.

The Israeli business publication Globes reported Friday that Harvard had notified the Security and Exchange Commission that it had sold its nearly $38.7 million investment in five Israeli companies and that it offered no explanation for the move.

That news was soon followed by a statement from Hind Awwad, coordinator of the Palestinian Boycotts, Divestment and Sanctions National Committee. He was quoted by the website Media Line as saying: “We welcome Harvard’s decision and encourage all academic institutions in the U.S. and elsewhere to follow its lead, to invest in socially responsible investments and divest from Israeli war crimes.”

Alarmed by the reports, the Conference of Presidents of Major American Jewish Organizations contacted Harvard and was told the university was simply rebalancing its portfolio.

But Malcolm Hoenlein, the group’s executive vice chairman, said his organization “expressed concern to the president of the university that a perception was created and that a clarification was important so that others would not use it as a pretext for similar action.”

The Harvard Management Company, a wholly-owned subsidiary of Harvard that manages its endowment and financial assets, issued a statement Monday said it has “not divested from Israel.” 

It explained that it had sold its investment in the five Israeli companies — including the pharmaceutical giant Teva — only because Israel had been part of its emerging markets portfolio and that when the country’s status was upgraded to developed market, it had to sell those holdings.

It adding that Harvard continues to have holdings in “developed markets, including Israel, through outside managers in commingled accounts and indexes.”

There was no immediate response from the pro-Palestinian group.

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