N.J. to Pull $182 Million Out of Unilever Over Ben & Jerry’s and Israel

New Jersey has become the latest state to announce plans to divest from the company that owns Ben & Jerry’s over its decision to stop selling ice cream in Israeli-occupied territories.

The state’s Division of Investment sent a letter this week to Unilever, the New Jersey-based parent company of Ben & Jerry’s, explaining that a state law passed in 2016 prohibited the investment of state pension funds in businesses that engaged in boycotts.

At the start of this week, New Jersey had $182 million invested in Unilever stock, bonds and other securities, a spokeswoman for the state’s treasury department said.

The move came as a response to Ben & Jerry’s announcement in mid-July that it would stop selling its products in the occupied Palestinian territories. “We believe it is inconsistent with our values for our product to be present within an internationally recognised illegal occupation,” the company said on its website.

That decision by Ben & Jerry’s led to intense criticism in Israel, with the nation’s ambassador to the United States, Gilad Erdan, going so far as to accuse the company of being anti-Semitic. The founders of Ben & Jerry’s, Ben Cohen and Jerry Greenfield, said in an essay in The New York Times that, “As Jewish supporters of the State of Israel, we fundamentally reject the notion that it is anti-Semitic to question the policies of the State of Israel.”

The founders said that they had expected a “swift and powerful” reaction. And they got one.

Israel’s Prime Minister Naftali Bennett vowed to “act aggressively” against the decision and Mr. Erdan urged dozens of governors to punish the company under anti-boycott laws like the one New Jersey invoked this week. Last week, the state of Arizona announced that it would pull its $143 million in public funds out of Unilever.

The director of New Jersey’s Division of Investment, Shoaib Khan, said it had determined after a review that Ben & Jerry’s actions “constituted a boycott of Israel or companies operating in Israel or Israeli-controlled territory.”

The state then sent the letter to Unilever, a British company whose United States headquarters are in Englewood Cliffs, N.J., to notify the company about the decision.

Unilever’s chief executive, Alan Jope, has tried to ease tensions over the matter. In late July, he sent a letter to the Conference of Presidents of Major American Jewish Organizations to express the company’s opposition to “any form of discrimination or intolerance.”

Mr. Jope also addressed the complex relationship between Unilever and Ben & Jerry’s. After Unilever bought the company in 2000, Ben & Jerry’s retained its own board of directors. That board has the right to “take decisions in accordance with its social mission,” Mr. Jope wrote.

Ben & Jerry’s, which Mr. Cohen and Mr. Greenfield started in Vermont in the 1970s, has always promoted a progressive worldview, exemplified by tie-dyed T-shirts and ice-cream bars called Peace Pops. The founders are no longer on the four-member board, but its chair, Anuradha Mittal, says her role includes ensuring that Ben & Jerry’s sets standards for other companies.

A spokesman for Ben & Jerry’s, Sean Greenwood, declined to comment on New Jersey’s decision.

State Senator Tom Kean, a Republican, said the move demonstrated the success of the 2016 law he co-sponsored with State Senator Loretta Weinberg, a Democrat. The law prohibits public investments in companies that engage in boycotts, divestment or sanctions of Israel.

“Our law sends the clear message that New Jersey will not tolerate anti-Semitism and we won’t financially support businesses that target Israel,” Mr. Kean said.

Mr. Kean said this was not the first time the law had been employed successfully. In 2019, New Jersey said it would be prohibited from investing in Airbnb because the company refused to list rental accommodations in Israeli settlements in occupied territories. Following similar actions by other states, Airbnb reversed its policy.

The leaders of the Jewish Federations of New Jersey praised the choice to divest from Unilever in a statement: “We commend the state of New Jersey for their decision, delivering a rebuke to those who would discriminate against the State of Israel — an ally of the United States and a vibrant economic partner of the state.”

But Selaedin Maksut, executive director of the New Jersey chapter of the Council on American-Islamic Relations, called the decision “shameful.” He applauded Ben & Jerry’s and said accusations of anti-Semitism were a smoke screen to distract from Israel’s actions in the occupied territories.

“I am deeply disturbed that the State of New Jersey would actively punish its residents and businesses who boycott foreign nations that participate in war crimes,” he said. “Boycott and criticism of Israel is not anti-Semitism, it is standing up to an oppressive, institutionally racist, far-right-wing government. I expect New Jersey to reconsider its decision, lest it finds itself on the wrong side of history.”