‘Divest from Israel’: Decoding the Gaza protest call shaking US campuses

University students are facing threats of arrest or suspension as pro-Palestine protests are burgeoning across campuses in the United States. Students are expressing solidarity with Palestinians in the Gaza Strip, where more than 34,000 people have been killed in Israel’s war of the enclave since October.

Students are calling on their universities to “disclose and divest” their investments in companies and organisations linked to Israel and its war on Gaza.

On Monday, the president of Columbia University, Nemat “Minouche” Shafik, released a statement asserting that Columbia will “not divest from Israel”, prompting protesters to occupy a university building early on Tuesday.

So what exactly is divestment and how do the students want their universities to divest? Here’s more:

What does divestment mean?

Divestment is the process through which an organisation sells off its shares, assets or other investments for political, ethical or financial reasons, according to the Cornell Law School website. In the case of a university, to divest would mean to pull out of investments in certain companies made with money from the university’s endowment fund.

The demand for divestment is not new in the movement against Israel’s occupation of Palestine. In fact, divestment is central to the Boycott, Divestment and Sanctions (BDS) movement, an international effort calling for the boycott of companies accused of being complicit in the occupation of the Palestinian territory, the war on Gaza and violating international law.

What are the students’ divestment demands?

• The protesters at Columbia University, who began building encampments on campus on April 17, are calling for Columbia to divest from corporations that they believe profit from Israel’s war on Gaza.
• Protesters at Columbia passed around a leaflet during admitted students weekend on April 20 and 21 listing the names of some of these corporations – Lockheed Martin, HEICO, BlackRock, Google and Microsoft – Caroline Anne Bissonnette, a journalism student at Columbia who has been covering the protests since they started, told Al Jazeera.
• The New York University (NYU) Alumni for Palestine website calls on NYU to “terminate all vendor contracts with companies playing active roles in the military occupation in Palestine and ongoing genocide in Gaza, namely Cisco, Lockheed Martin, Caterpillar and General Electric”.
• Students at different US universities are calling for greater transparency about their institutions’ investments. A student who is part of the encampments at Tufts University outside Boston told Al Jazeera that one of the “biggest demands of the students” is for the university to disclose its investments.

Why have these companies been named?

The NYU Alumni for Palestine group cited investigations published by the Economic Activism Program of the American Friends Service Committee (AFSC), a Quaker organisation that promotes lasting peace with justice, which names four specific companies.

An investigation of the US-based technology company Cisco revealed that it had established a long-term partnership with Israel in 2018 to develop government-subsidised co-working hubs to help integrate small towns and remote regions to the Israeli high-tech industry. Some of these hubs have been at least partially established in “occupied Palestine and Syria”. Israel’s occupation of the West Bank (Palestine) and the Golan Heights (Syria) is viewed as illegal under international law by most countries.

Maryland-headquartered Lockheed Martin is the world’s largest military company, and an AFSC investigation found that it supplies the Israeli government with weapons. Additionally, the weapons are sometimes “gifted to Israel through the US government’s Foreign Military Financing program”, the investigation found.

Equipment made by US bulldozer manufacturer Caterpillar has also been gifted to Israel through the US financing programme. The Israeli military routinely uses Caterpillar’s D9 bulldozers to demolish Palestinian properties, the AFSC found.

It added that engines and electric power and mechanical systems of the Boston-based General Electric are integrated into the Israeli military’s fighter jets, attack helicopters and surveillance aircraft.

What impact can divestment have?

“Divestment is really hard to do,” Christopher Marsicano, an assistant professor of educational studies at Davidson College in North Carolina who researched the impact of divestment from fossil fuels on university endowments, told Al Jazeera. It is much easier to divest if you have a very small stake in a company, he explained.

He said that while divestment will probably not have much of an economic impact on either university endowments or the Israeli economy, the political impact could be more significant. “Israeli Prime Minister [Benjamin] Netanyahu has already mentioned student protests at American universities publicly. It is clear that these protests have captured the attention of the Israeli government and are putting some pressure on stakeholders to support a ceasefire,” Marsicano said.

How easy is it to divest?

It could in fact be quite difficult for most universities managing large endowment funds to divest from all the companies that do business with Israel and weapons manufacturers. Marsicano explained that university endowment fund managers at most US colleges are “doing what most Americans who have a retirement plan are doing. They’re investing in index funds and private equity.”

Index funds offer investors exposure to all the companies listed on one specific index of shares. A fund tracking the FTSE 100, for example, holds shares in all 100 of the largest companies listed on the London Stock Exchange. Investors in the tracker fund cannot pick and choose which shares to hold. Tracker funds are a popular form of investment for large institutional pension or endowment funds because they provide a good way of diversifying holdings and, therefore, reducing risk.

Furthermore, as companies’ share prices rise and fall, so do their market capitalisations, the value of all of their stocks. That means companies can drop in and out of different indices. It is, therefore, tricky for investors to screen out specific companies.

Can it be economically beneficial to divest?

Not necessarily. The concept of ethical investing – choosing only companies that behave ethically or screening out companies that do not – is no guarantee of good investment returns, Marsicano said. While proponents of divestment say “investing in opportunities that do good in the world will also lead to good investment returns, endowment managers aren’t so sure”, he added.

“What our work showed with fossil fuels [was] that at worst there are negligible effects to the endowment and at best there are positive returns due to divestment. If that world comes, you might see endowment managers make the decision to divest,” Marsicano said.

Will US universities divest from Israel?

Shafik’s statement on Monday indicated that Columbia would not be divesting any part of its $13.64bn endowment fund.

Shafik added, however, that Columbia has offered to develop an “expedited timeline for review of new proposals from the students by the Advisory Committee for Socially Responsible Investing, the body that considers divestment matters”.

Additionally, Shafik said, Columbia is offering more transparency about investments by allowing students to access a list of Columbia’s direct investment holdings, those not held via a tracker or other form of investment fund. Columbia has also offered to update that list more frequently.

However, in a statement posted to X on Monday, Columbia Students for Justice in Palestine claimed the direct investments account for “a mere 6.12 percent of Columbia’s $784m publicly traded investments”. The statement called on Columbia to divest from weapons manufacturers that “profit off the thousands of bombs that have decimated Gaza”.

NYU’s student newspaper, Washington Square News, reported that NYU spokesperson John Beckman said the university is not divesting because it is trying to maximise returns on its endowment to “help the university fulfil its research and educational mission”. Beckman added that NYU’s endowment, valued at $5.9bn, is smaller than that of its peers.

The endowment fund for Northwestern University in Illinois is valued at $14.4bn while Yale University’s endowment is valued at $40.7bn.

Students made efforts to persuade NYU to divest from companies including “GE, Lockheed Martin, Caterpillar and Boeing because they do business with Israel” in 2018, according to a statement released by Beckman in December 2018. “The University opposes this proposal,” the statement read, adding: “It is at odds with the Trustees’ well understood position that the endowment should not be used for making political statements.”

The 2018 statement also said divestment would be an operational challenge because NYU’s endowment assets “are invested through independent financial managers who operate funds in which our assets are co-mingled with others. NYU cannot unilaterally direct those fund managers not to select certain companies’ stock.”

Besides divestment, what do the students want?

Students in the US and abroad are also calling on their institutions to boycott Israeli universities and exchange programmes, to have open dialogue about the war on Gaza, to condemn the killing of Palestinian civilians and to protect students, faculty and staff who are speaking up for Palestine from harassment and censorship.

What’s the latest on the college protests for Gaza?

Columbia issued a deadline on Monday for students to dismantle the encampments of about 120 tents by 2pm (18:00 GMT). They were also asked students to sign a form guaranteeing they would abide by university rules through June 2025. Students who refuse to do this could be suspended pending further investigation.

Columbia Students for Justice in Palestine released a statement on X about four hours before the deadline saying, “Columbia University illegally fabricates a ‘state of emergency’ to mass suspend, expel, and evict hundreds of peaceful protestors by 2 PM today.” The statement added that the protesters had informed the university they were prepared to “escalate their direct actions if Columbia does not adopt basic standards of conduct for negotiations”.

On Tuesday morning after Columbia’s refusal to divest, protesters occupied the university’s Hamilton Hall academic building, in a move reminiscent of the 1968 protests in Columbia against the Vietnam War. They renamed the building Hind’s Hall after Hind Rajab, a six-year-old girl killed in Gaza.

Another statement released by Columbia Students for Justice in Palestine on X on Tuesday said the protesters intend to occupy the hall until Columbia concedes to the protesters’ demands, including divestment. The statement warned Columbia against bringing armed soldiers or police officers on campus. “Students’ blood will be on your hands,” it said.