NEW REPORT: Minnesota Break the Bonds Campaign at the December 2, 2014 State Board of Investment Meeting

NEW REPORT ON ISRAEL’S HUMAN RIGHTS RECORD. Read here: MN BBC Shadow Report on Israel’s Human Rights Record

Minnesota Break the Bonds Campaign once again had a fabulous showing with about 25 supporters at the State Board of Investment meeting on December 2. At this meeting we presented the four executive officers of the Board (Governor Mark Dayton, State Auditor Rebecca Otto, Secretary of State Mark Ritchie, and Attorney General Lori Swanson), along with Executive Director Mansco Perry and Secretary of State – Elect Steve Simon, copies of a Shadow Report, that we had written (see the Cover Letter and read the report).

In the 1990s when Mark Dayton was State Auditor, he encouraged the SBI to incorporate investment guidelines which took into account human rights of a country before the SBI could invest. Countries were researched based on six human rights categories and classified into one of three groups. Group I was the best and the SBI could invest in Group I countries without restriction (except as imposed by the statutes). Group II countries had some issues, although generally laws were on the books protecting human rights. If a fund manager wanted the SBI to invest in a Group II country, he or she had to make a statement that it would be a breach of fiduciary duty NOT to invest. Group III countries were the most problematic and investment in those countries required justification for the investment. Countries were to be re-categorized annually. Israel had always been classified as a Group II country.

The SBI became lax about re-categorizing countries annually and 2005 was the last re-categorization. At that time they decided to change the annual process into a quadrennial one. Yet in 2009 they did not re-categorize any country. Since this process should take place prior to the issuance of the SBI’s annual report, where all countries are listed with the categories, MN BBC took it upon ourselves to write the report for them. We took the six criteria and researched reports that well-respected human rights organizations had written regarding those six criteria:

(1) Freedom from Political or Extrajudicial Killing or Disappearance
(2) Freedom from Torture
(3) Right to a Fair Public Trial and Due Process
(4) Freedom of Speech and Press
(5) Right of Citizens to Change Laws, Officials and Government, and
(6) Freedom from Discrimination based on Race, Religion, Sex or Social Status

Based on the results of the research, we requested that the Board re-classify Israel as a Group III country – one that commits egregious human rights abuses.

At the beginning of the quarterly SBI meeting we distributed the paper to the board. We had informed them in advance that we would like some time at the end of the meeting to introduce the paper. Governor Dayton gave Ilana the floor and she stayed at the table while the SBI debated aspects of Minnesota’s investment in Israel Bonds. Perry said that the country categorization only refers to equity, not bonds. Ilana asked a pointed question which made that statement look foolish – why, if investing in a country’s equities is bad for human rights reasons, would it be acceptable to invest in their bonds? Rebecca Otto, the State Auditor, repeated several times that the SBI does not get involved in politics and that we should go to the state legislature. Ilana responded that the decision to invest in the Bonds in the first place was a political one. Governor Dayton appeared to be reluctant to give the legislature power over the SBI’s investment decisions. Read the report here: MN BBC Shadow Report on Israel’s Human Rights Record

Mansco Perry said that the country categorization process was only for “emerging markets” and since Israel is no longer an emerging market it automatically becomes a Group I country.

Throughout Ilana’s presentation, the governor was paging through the report and apparently taking it in.

The next quarterly SBI meeting in March (the date is not posted yet), is when renewal of the investment in the $10 million Israel Bond will come up for discussion. It is imperative that we show up in force and let the Board know that we do NOT want Minnesota taxpayers’ money to fund human rights abuses. If you have not yet signed the petition asking the SBI not to re-invest, please contact us through the website or at This is a paper-only petition and we need as many signatures as possible by March 1.

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