Reputational risk rises for the world's biggest security company over Israeli government contracts.
British-Danish security firm G4S this weekend reacted to a wave of protest by rehashing claims that it will eventually quit its Israeli contracts in the occupied West Bank. But in fact G4S staff will “continue to service security systems in commercial and government sites inside Israel, including jails housing Palestinian inmates” and continue to protect businesses in the settlements.
On Palestinian Prisoners Day, which was marked last Wednesday, human rights groups staged protests worldwide against the G4S role in securing Israeli prisons. G4S provides security services to Israeli detention and interrogation centers where Palestinian political prisoners (including teenagers) are held.
G4S campaign reaches international business press
On Sunday, British daily the Financial Times reported on its website that G4S would quit “key contracts in Israel amid protests against its involvement in settlements within occupied Palestinian territories.”
The newspaper mentioned ongoing protests against G4S in London and other countries, a call by non-governmental organizations in Egypt, Lebanon, Jordan and Palestine on Arab nations and the European Union to stop dealing with G4S, and the Scottish Trades Union Congress vote in favor of Palestinian calls for a boycott of the company.
G4S told the Financial Times it would quit a number of contracts which involve the servicing of security equipment at the barrier checkpoints, prisons and police stations in the West Bank by 2015. G4S said it wants “to ensure that our business practices remain in line with our own Business Ethics Policy.”
But in March 2011, after fierce criticism in the Danish press, G4S made a very similar announcement (PDF).
Successful campaigns against companies who are complicit in Israel’s violations of international law can be a threat. Last February, Norwegian financial expert Hege Sjo mentioned Veolia as an example of a company that has experienced “reputational damage as a result of publicity and pending litigation” due to “operations in troubled regions,” in this case: “Involvement in infrastructure project in the occupied territories.”
Citing financial analyst Kean Marden, the Financial Times writes, “the Israel/Palestine conflict has created reputational issues” for G4S.
Last year, also G4S lost credibility after failing to deliver on its contract to provide security for the 2012 London Olympics. Chief executive Nick Buckles admitted that G4S’s reputation was in tatters. So the company has since given higher priority to “reputational risk” by establishing a risk committee to conduct reviews of the operational and reputational dangers of contracts worth more than £20 million (approximately $30 million US).
G4S is the result of a merger between the Danish security company Group4Falck and the British Securicor company.
In 2002, Group4Falck bought Hashmira – one of the largest Israeli security companies. Immediately, former Danish Foreign Minister Per Stig Moller criticized Group4Falck for its activities in the West Bank, prompting the company to leave the West Bank.
Eight years later, Danish financial watchdog DanWatch and Who Profits? (a project of Coalition of Women for Peace in Tel Aviv) revealed that G4S had resumed its activities in the occupied West Bank contrary to the will of the Danish government. The decision is difficult to reconcile with G4S’s claim today that it wants to keep its business practices “in line with its own Business Ethics Policy.”
If G4S is serious about business ethics, it should never had entered into contracts which contribute to the oppression of Palestinians.
If G4S really considers its contracts in the West Bank unethical, is should exit these contracts today. Every day that the company continues to be involved in Israel’s violations of international law will have an impact on G4S’s reputation.
Last week, activists in the Netherlands called on the Technical University (TU) in Delft to end its contract with G4S. Liesbeth Zegveld, human rights attorney and professor in international law at Leiden University, told TU’s magazine that she would applaud a decision to end the relationship with G4S by the TU.
The idea to not do business with companies which are complicit in violations of international law is gaining ground. “You can simply say: we don’t want to be part in this. This way, you can actually make an impact,” according to Zegveld. “If citizens no longer accept that Israel violates human rights and international law and foreign companies will withdraw from Israel, the country has to change.”
That is why the boycott, divestment and sanctions movement needs to keep campaigning against G4S as long as it remains involved in securing prisons in Israel and the West Bank, in securing a police station in the West Bank and checkpoints in the wall, and in protecting businesses in settlements.
This piece was first published on The Electronic Intifada.