Thursday, 7 July 2011

The Church of England's Unethical Investment in Veolia

The Interfaith Group for Morally Responsible Investment (IMRI) has recently been in discussion with the Ethical Investment Advisory Group (EIAG), which advises the Church of England on its investments, over its investments in Veolia. IMRI’s concern is with Veolia’s support for Israel's illegal settlements through its bus services and the Jerusalem light rail tramway that link the settlements to Israel, and its Tovlan landfill site that takes settlements' rubbish.

As Brent Palestine Solidarity Campaign writes:
“The Veolia parent company is Veolia Environnement, a French multinational. Veolia Transport, a subsidiary of Veolia Environnement, is a leading partner in the CityPass consortium, contracted to build a light-rail tramway system linking west Jerusalem to illegal Jewish settlements in occupied east Jerusalem. Once completed, the rail system will cement Israel's hold on occupied east Jerusalem and tie the settlements even more firmly into the State of Israel. And not only the settlements in east Jerusalem: the “Ammunition Hill” station of the network will operate as the feeder station for settler traffic from Ma’aleh Adumim, a large Israeli settlement in the West Bank, and from Jewish settlements in the Jordan Valley.”

The EIAG has responded to a campaigner's letter with the following comments (in italics). IMRI continues to question the ethical advice being given by the EIAG:

It is not the EIAG’s practice to recommend that the national investing bodies of the Church avoid investment in companies operating in particular territories or countries such as Palestine, Sudan or Burma on the grounds that breaches of international law, international humanitarian law or human rights are associated with those territories or countries.

As EIAG I think realises, the issue is not that Veolia is operating in Israel or Palestine, but that certain of its operations constitute complicity in Israel's breaches of international law.

The court case in the French courts brought by the Palestinian Solidarity Association about the legality of Veolia’s involvement in the JLRT in terms of both international and French law (I believe that the court has issued its first finding and found that Veolia is not in breach of international or French law)

That is not strictly correct. The Court decided that it had to answer a preliminary question, namely whether the international law provisions in question gave rise to justiciable rights under French law between private parties (horizontal impact of international law). It answered that question negatively, but that is not the same as clearing Veolia of a breach of international law, which was not in fact addressed by the Nanterre High Court.

Our approach is to consider what companies themselves are doing, not to judge companies on the grounds of what the states in the territories or countries where the companies operate are doing.


Where the objection is complicity in the state's wrong-doing that wrong-doing is very relevant. This is the case with Veolia and Israel.

“Companies are encouraged to take adequate steps to identify the interaction between their core business operations and conflict dynamics and ensure that they do no harm.” (Core Business Guidance Point 1)

Complicity in Israel's breaches of international law is a clear case of interaction between Veolia's core business operations and conflict dynamics that does great harm.

The EIAG’s position in this engagement with Veolia has been that Veolia need to reassure the EIAG that their business activities (a) conform with international law, (b) do not discriminate between Palestinians and Israelis, and (c) make the situation on the ground better not worse.


(a) Veolia's complicity in Israel's violation of international law may or may not be illegal, but it cannot be described as conforming with international law.

(b) Veolia's bus services certainly discriminate between Palestinians and Israelis, as has their advertisement for light rail operatives.

(c) Veolia's support for settlements certainly makes the situation on the ground worse by consolidating and perpetuating their illegal establishment

The EIAG takes the view that Veolia has responded to our engagement seriously and responsibly, and that the disposal by the company of its interest in the JLRT meets our concerns.


The disposal of Veolia's JLRT interests has not yet happened and may not do so. Veolia has not admitted to anything unethical about its JLRT involvement and says that it is selling up merely because it was made a good offer. Taking into account too the technical assistance contract that will maintain Veolia's involvement even if its JLRT shares are sold, its bus services that it is doing nothing about, and its cynical intention (perhaps realised by now) of selling Tovlan to an illegal Israeli settlement, Veolia's stated intention of selling its JLRT shares cannot be an adequate indication that it is abandoning its unethical practices. Veolia's contracts, operations and intentions still amount to complicity in war crimes. They should be of deep concern to the EIAG, and the Church of England should not hold shares in Veolia whilst they continue.


For further information see: “French court decision on Jerusalem light rail must be challenged” by Daniel Machover and Adri Nieuwhof

See also correspondence with the EIAG in 2005 over its questionable advice to the Anglican Church on Caterpillar