Skip to main content
You have permission to edit this article.
Ben & Jerry's' Israel flap leads Arizona treasurer's office to divest assets
alert top story

Ben & Jerry's' Israel flap leads Arizona treasurer's office to divest assets

  • Updated

PHOENIX — Arizona is wading into Middle East politics.

And it involves ice cream.

State Treasurer Kimberly Yee announced Tuesday she is selling off all of the state's notes it holds in loans to Unilever. That follows the announcement that the company will no longer sell its Ben & Jerry's brand ice cream in Israeli-occupied territories, including the West Bank and contested east Jerusalem, all of which Israel claims as its capital.

Yee, in a news release, said she had no choice.

She cited a 2016 law that says state entities are prohibited from doing business with any company that boycotts Israel. The decision not to sell ice cream in the Palestinian territories occupied by Israel triggers that law.

The move comes despite a Unilever official contacting Yee with an argument that the company is not violating the law because it is not boycotting Israel.

When Unilever acquired the Vermont company in 2000, it allowed it to retain an independent board and to make decisions not approved by the corporate parent.

Yee, in a letter to Richard Williams, head of investor relations for the company based in London, said that is irrelevant.

"The fact remains that Ben & Jerry's is a legal subsidiary of Unilever and due to the decision by Ben & Jerry's, continues to be in violation of Arizona law," Yee wrote.

Arizona's Unilever holdings in the form of bonds and commercial paper — $143 million as of the end of June — have already been reduced to $50 million "and will be zero by Sept. 21 after our last investment in Unilever matures," Yee said. 

In essence, the law says the state may not invest money with any company that boycotts Israel. That can mean not buying stock in those companies.

In this case, however, Arizona has no stock in Unilever. What the treasurer's office has purchased are bonds — and/or other forms of lending, from which the state can earn interest payments — from Unilever. That is what is being sold off.

Nothing in the law affects the ability of Unilever or any other company that boycotts Israel to sell their products in the state.

Overall, the treasurer's office manages about $26 billion in assets.  

The 2016 state law was in direct response to what has become known as the BDS Movement — boycott, divest, sanction — designed to pressure Israel to withdraw from the territories it seized after the 1967 war and continues to occupy. David Gowan, who was a Republican state representative from Sierra Vista in 2016, called the BDS Movement "anti Semitic.''

"This bill is aimed at showing Arizona's support of Israel, its strongest ally in the Middle East," he said at the time. "Nobody should be doing things for bigotry."

Deputy Treasurer Mark Swenson said the office annually reviews its holdings to ensure compliance. He said this is the first time a decision has been made to divest.

There was no immediate response from Unilever. But in an essay in July in the New York Times, Ben & Jerry's founders Bennett Cohen and Jerry Greenfield defended the sales decision.

They said they are supporters of Israel, and that it was one of their first overseas markets.

"But it's possible to support Israel and oppose some of its policies, just as we've opposed policies of the U.S. government," they wrote. And the men, who described themselves as "proud Jews," denied the move is a contradiction or anti-Semitic.

"In fact, we believe this act can and should be seen as advancing the concepts of justice and human rights, core tenets of Judaism," they said.

That sentiment mirrors some of the comments made when the state law was passed by the Arizona Legislature in 2016, with 14 House members and six senators in opposition.

Yee, who voted for the 2016 measure when she was a state senator and who is now seeking the Republican nomination for governor, declined to be interviewed.

Subscribe to stay connected to Tucson. A subscription helps you access more of the local stories that keep you connected to the community.

Get local news delivered to your inbox!

* I understand and agree that registration on or use of this site constitutes agreement to its user agreement and privacy policy.

Related to this story

Get up-to-the-minute news sent straight to your device.


News Alerts

Breaking News