The Norwegian Sovereign Wealth Fund, the largest in the world with assets totaling two trillion dollars, announced on Monday its decision to divest from the American construction equipment group Caterpillar, as well as five Israeli banking groups, citing “ethical reasons.” The fund stated that the Israeli banks are Hapoalim, Leumi, Mizrahi Tefahot, First International Bank of Israel (FIBI), and FIBI Holdings. Managed by the Norwegian Central Bank, the fund excluded these groups due to “unacceptable risks of their contribution to serious violations of individual rights in situations of war and conflict.” Records show the fund held a 1.17% stake in Caterpillar valued at $2.1 billion as of June 30. The combined value of its stakes in the five Israeli banks was $661 million as of the same date. The fund’s Ethics Council stated that there is no doubt that Caterpillar’s products are used in widespread and systematic violations of international humanitarian law.

Israeli authorities have used Caterpillar bulldozers in illegal and extensive demolitions of Palestinian properties in Gaza and the West Bank. The company has not implemented measures to prevent this use. With deliveries of related machinery to Israel set to resume, the council sees an unacceptable risk that Caterpillar contributes to serious violations of individual rights during war or conflict. The council, established by the Ministry of Finance, verifies companies’ compliance with ethical standards set by the Norwegian Parliament. The fund invests in nearly 8,400 companies worldwide. The Ethics Council’s recommendations were approved by the Central Bank’s board. On August 18, the fund announced it would withdraw investments from six Israeli companies amid an ongoing ethical review related to the Gaza war and developments in the West Bank, but did not name them at the time.