$59 Billion Australia Pension Reviews Investments as Israel-Linked Firms Face Pressure

(Bloomberg) -- Cbus, one of Australia’s largest pension funds, is reviewing its investment policy following pressure from a major union to divest shares in companies that supply weapons and defense technology to Israel.

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The fund, which oversees A$90 billion ($59 billion) of assets, is assessing its policy amid “community concern over the conflict and loss of life in Gaza and Israel,” a spokesman said in a statement. The fund already excludes direct investments in some weapons manufacturers.

“Cbus’s exclusions framework is currently under review to ensure it remains reflective of the current environment and responsive to our members’ concerns, while also ensuring we meet all of our regulatory obligations,” the spokesman said, without naming any investments.

The review was first reported by The Guardian earlier Friday, which referred to companies including Lockheed Martin Corp. and RTX Corp. The firms that were cited represent about 0.01% of Cbus’s portfolio, the spokesman said.

“However, we understand that even a small holding in the current climate may cause concern,” he added.

The Construction, Forestry, Maritime and Energy Union approached Cbus’s top management about its policy as part of a broader push for all industry pension funds to divest, the union said in a statement. It was concerned about retirement savings being invested with companies involved in the Middle East conflict.

The union sponsors three of the board positions at Cbus, a fund that was originally set up for construction workers, but is now open to anyone.

“We welcome Cbus urgently reviewing its portfolio,” CFMEU National Secretary Zach Smith said in an emailed statement. “Now it’s up to other industry funds to follow their lead.”

Israel has faced international pressure over its operations in response to the October 7 attack by Hamas that triggered the ongoing war in Gaza. The US has paused some arms shipments to Israel amid concerns about a ground invasion of the Gazan city of Rafah, while students are staging nationwide protests urging their universities to divest from companies tied to the conflict.

Cbus owned around A$3 million of shares in Lockheed Martin, which supplies Israel with F-35 fighter jets, at the end of last year, according to latest disclosures on its website. It also owned about A$3.5 million of shares in RTX, which has sold weapons to Israel.

“Questions regarding investment strategy and related policies are best addressed by Cbus,” a Lockheed Martin spokesperson said. RTX didn’t respond to an email.

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