Yahoo Finance How Barclays became a lightning rod for Gaza activists
When Barclays executives descend on Glasgow next week for the bank’s annual shareholder meeting, expect to see tight security.
The lender is on high alert for possible protests by pro-Palestinian campaigners who have in recent months taken aim at the bank over its perceived support for Israel’s conflict in Gaza.
Barclays has provoked the ire of anti-war groups who claim the Quaker-founded bank “bankrolls” defence and military companies that are supplying weapons to the Israeli army.
Branches in London, Derby, Coventry, Ipswich, Leeds, Cambridge and Oxford have all been hit by protests demanding an end to the bank’s “investment” in Israel’s Gaza operations.
“Barclays blood money” and “stop investing in Israel’s crimes against humanity” are frequent messages on the front of placards and banners.
Protests have ramped up in recent weeks, with a Barclays branch in Croydon smashed and vandalised with pro-Palestinian graffiti. “Baby Killers stop arming Israel. Free Palestine. Stop funding genocide”, were daubed in large red letters over the front of the bank.
The leading campaign group targeting the bank, the Palestine Solidarity Campaign (PSC), has organised a mass account closure for Barclays customers, scheduled for May 9 to coincide with the bank’s AGM.
On Wednesday, Palestine Action, another campaign group, claimed responsibility for vandalism at Barclays office in Manchester, when the building was doused with red paint.
A British bank with no branches in Israel may seem an unlikely lightning rod for pro-Palestinian activists.
However, Barclays is just the latest in a growing list of corporations who have found themselves targeted as the Israel-Gaza conflict polarises large swathes of society. Companies ranging from Starbucks and McDonald’s to Google have been targeted and are struggling to contain the anger directed at them.
Protestors have long-claimed Barclays has deep links with the defence industry.
As far back as 2022, the PSC was claiming that Barclays was funding the Israeli defence forces.
“Our research has identified Barclays as a major financier of companies arming Israel,” the group said in a research report. “Barclays bank holds substantial financial ties with arms companies supplying weapons and military technology to Israel, used in its attacks on Palestinians.”
According to the PSC, Barclays is “complicit” in Israel’s attacks on Gaza’s civilian population because it holds £1.6bn worth of shares in, and provides £3bn of loans to, military companies that make technology used in Israel’s Gaza operations.
Defence companies where Barclays is claimed to be a shareholder include: UK manufacturers BAE Systems, Ultra Electronics and Qinetiq; US contractors Boeing, Caterpillar and General Dynamics; and some Israeli contractors.
Barclays has lent or underwritten financing for Boeing, Caterpillar, BAE Systems, Rolls Royce, Raytheon and QinetiQ, the PSC claims.
BAE Systems and Rolls-Royce are involved in the production of the F-35, which have been used in the Gaza conflict, while Caterpillar makes D9 bulldozers used by the Israeli military. General Dynamics manufactures the Namer armoured vehicle for Israel. Boeing manufactures the Apache attack helicopter and Hellfire missile.
However, it is Barclays ties to Israeli defence company Elbit Systems that causes the most controversy.
Elbit Systems, listed in Tel Aviv and New York, is a constant focus for pro-Palestinian campaigners.
According to activists, Elbit manufacturers weapons that have been used in historic bombardments against the Gaza Strip.
Most damaging of all, the PSC claims that Elbit is “associated” with the production of “banned cluster munitions”, a claim the company has refuted.
Protests, mass account closures and vandalism of Barclays’ branches are all aimed at prompting the bank to cut all financial ties with these defence businesses.
However, Barclays claims protestors have fundamentally misunderstood its business.
On Thursday the bank issued a document addressing the claims, and strongly refuting the allegations made by the protestors. Banks are not the same as fund managers, Barclays pointed out, and its so-called “investments” reflect the shares held by its private wealth and retail customers in their own personal accounts, rather than the bank itself.
“We are not making investments for Barclays and Barclays is not a ‘shareholder’ or ‘investor’ in that sense in relation to these companies,” it said.
To head off the accusations against Elbit, which provokes the most fury from activists, Barclays also pointed out that the same company supplies the UK armed forces.
“We would cease any relationship with any business where we saw evidence that it manufactures cluster bombs or components,” it added.
The response is not enough to quell activists. In a statement, the PSC said: “Holding these shares on behalf of clients doesn’t somehow abrogate Barclays’ ethical and moral responsibilities.
“However it holds them, Barclays is profiting from the production of weaponry which is then used in Israel’s attacks of Palestinians.”
Barclays is not the only lender facing fire over its relationship to Elbit. Canada’s Scotiabank faced a campaign last year demanding the bank divest shares in Elbit. Scotiabank said the claims contained misinformation and “confusion”.
Despite campaigners often seeming like fringe voices in the City of London, their criticism of defence firms has gained traction in some parts of the mainstream money management community.
Norway’s largest pension fund KLP, which manages $100bn (£78bn) of assets, has blacklisted investments in companies that make “controversial” weapons.
These include Elbit Systems, General Dynamics, Raytheon and Rolls-Royce. KPL said it remained an investor in Barclays.
Barclays traces its roots back to 1690 when two pacifist Quakers started the bank. However, despite its religious origins it has found itself accused of ethical transgressions in the past.
During the height of apartheid it had a controversial presence in South Africa, which often prompted protests outside its Lombard Street headquarters during the 1970s and 1980.
The Anti-Apartheid Movement, the UK organisation at the centre of opposition, went as far as to publish a lengthy pamphlet in 1975 listing dozens of charges against Barclays.
Amid political pressure and a backlash from students who refused to open Barclays accounts, the bank pulled out of South Africa in 1986.
More recently Barclays had faced pressure from climate activists concerned over its funding of fossil fuel projects. In February it bowed to pressure from net zero activists by promising to crack down on clients who pursue new oil and gas projects without also developing green alternatives.
A similar climb down over its tangential links to Israel seems less likely. Pressure to cut ties with defence companies comes at a time when Prime Minister Rishi Sunak has made military spending a national priority to counter the threat of Russia. Mr Sunak last week made it clear he believes investment in national defence champions – including the likes of BAE, Rolls-Royce and QinetiQ – is clearly ethical.
Instead, clashes between pro-Palestinian activists and Barclays look set to continue. As the top brass rolls into Glasgow next week, the bank will be on high alert.
