The first significant action from the Churchwide staff came in the form of a video from ELCA Secretary Chris Boerger, which can be viewed on this page.
Relative to C1 and C2, there are two significant inaccuracies in this video. The first is Secretary Boerger’s mischaracterization of C2 as an action concerning “companies supporting the State of Israel.” In actuality, the wording of the Memorial states that the Church should develop: a “human rights social criteria investment screen based on the social teachings of this church and, in the case of Israel and Palestine, specifically based on the concerns raised in the ELCA Middle East Strategy.” The concern of the ELCA is with our own investments in companies that profit from the illegal occupation of the Israeli Government and Military, NOT with the much broader (and much more easily misconstrued) notion of “supporting the State of Israel”. Further, the sense of the Memorial is that it should be applied to other areas of human rights abuse, beyond the occupation of Palestine.
Second, did or did not the ELCA pass a memorial on divestiture? Secretary Boerger adamantly disavows reporting that the ELCA had acted to adopt “divestiture” and again uses the phrase “companies supporting the State of Israel”. Secretary Boerger goes on to say that divestiture would require that the ELCA “sell all assets in companies…supporting the State of Israel.” While this makes for perhaps a nice sound-bite description of the nature of divestment and the divestment/BDS movement among churches, the reality in practice is much more complicated.
Divestment in practice typically has a number of steps stretching over a period of years. The first is developing a “do-not-buy” list of companies that are considered violators, setting materiality thresholds for investments in the companies on the do-not-buy list, and identifying any existing potentially problematic investments. Any existing investments in companies on the do-not-buy list are not usually sold immediately, for two good reasons. The first is that the investment manager is still held to fiduciary standards of financial responsibility for the organization; market conditions will always dictate the timing of any sale of stock. The second reason for delaying an immediate sale is that such a sale forfeits any leverage encouraging the company to divest from the occupation through shareholder action (also keeping in mind that the BDS movement is about divesting from the occupation rather than selling investments in companies that “support the state of Israel.”)
Immediately selling your HP stock—as one example—does nothing to encourage HP to divest from the occupation. HP has plenty other buyers for your stock at the ready and would probably also love to be rid of any stockholders who make waves. Putting HP on a future “do not buy” list is a continuing sign that the company doesn’t meet the church’s/organization’s social responsibility criterion, plus the list encourages members of of that church/organization not to invest in the corporation.
In short, companies want to avoid any ongoing bad publicity; they usually could not care less about who owns their stock.
So again, did the ELCA adopt divestment? I think that fact remains to be seen. To the extent that an ELCA investment screen mirrors common investment practices surrounding divestment, then I think we could say accurately “yes.” But because the details of the screen have yet to be put into place, it’s difficult to say how closely ELCA action will follow that of other churches that have adopted BDS-like resolutions. But to adamantly state that the ELCA has NOT adopted a divestment approach is, to my mind, simply inaccurate.
If C2 is indeed not a divestment resolution, as Churchwide staff keep claiming, perhaps the Church needs to pass one in 2019?