In a move that will be seen by campaigners as a snub to the Church of England's 'Parliament', the Churchís Ethical Investment Advisory Group (EIAG) has said it will not recommend disinvestment from the controversial US company Caterpillar.
Their announcement follows a vote by the Church of England's General Synod last month  which urged that the call from Christians in the Middle East "to disinvest from companies profiting from the illegal occupation" be heeded.
The church currently invests about £2.5m of its £900m share portfolio in Caterpillar and had been engaged in negotiations with the company about its activities. Caterpillar insists it has not provided the earth movers directly to Israel but to the US military which sold them on.
Detailed in War on Wantís recent ëalternative reportí on Caterpillar, thousands of Palestinian homes and vast swathes of agricultural land have been destroyed by the Israeli military using armoured Caterpillar D9 bulldozers. The bulldozers have also been used in the construction of Israelís Separation Wall, ruled illegal by the International Court of Justice in July 2004.
One of the companyís machines killed American peace activist Rachel Corrie two years ago.
In a move that brought a wave of criticism from the Chief Rabbi  and politicians  amongst others, the General Synod urged that that call from the Episcopal Church in Jerusalem and churches elsewhere in the Middle East for morally responsible investment in the Palestinian occupied territories, be heeded.
Synod urged that the EIAG hold intensive discussions with Caterpillar, "with a view to its withdrawing from supplying or maintaining either equipment or parts for use by the state of Israel in demolishing Palestinian homes".
It said that EIAG should give weight to the "illegality under international law" of the activities in which Caterpillar was involved and said that the EIAG should update its recommendations.
However, in a statement issued today the EIAG has unanimously reaffirmed a previous decision, taken in September 2005, not to disinvest in Caterpillar.
The decision was made at a specially convened meeting.
The EIAG says it will instead continue its programme of engagement with Caterpillar and make clear its intention of revisiting this decision only if there are new sales of Caterpillar equipment to the Israeli defence forces for use in the demolition of Palestinian houses.
The EIAG, whose members include some nominated by the three investing bodies of the Church of England (the Church Commissioners, the Central Board of Finance and the Pensions Board) and representatives from the Mission and Public Affairs Council, the Archbishopsí Council and the General Synod, is responsible for giving ethical investment advice to the Churchís three investing bodies. The bodies alone have the legal authority to make investment decisions.
John Reynolds, chair of the EIAG said: ìThe EIAG reports regularly to the General Synod, and is gratified by what it sees as the rising level of interest in our work, and in particular by the wish of the General Synod to debate our report and the specific recommendations we make. We fully recognise that sometimes that interest will be critical, and lead to proposals that the EIAG reconsiders recommendations it has made.
ìThe EIAG recognises that the particular topic debated by Synod is hugely contentious, and EIAG members, like other Christians, have different perceptions of the situation in the Middle East. The Group in general, and its officers in particular, have spent an unusually large amount of time in engagement with Caterpillar and with the various groups representing Palestinian and Israeli, Jewish and Christian opinion seeking to influence its decision.
ìThe EIAG also well recognises that others will also have spent a great deal of time on this matter and acquired a great deal of knowledge about the situation. For that reason, and as a body which gives account to the General Synod, the EIAG took the resolution very seriously, and at its special meeting considered all the points made in the debate and gave particular weight to the letter it had received from the Bishop in Jerusalem, as well as the one which was quoted in the debate.î
The move however does not come as a surprise to some. Two weeks ago, talking about the Synod's vote, Jonathan Bartley of the thinktank Ekklesia warned in the Economist  that Anglicans often "follow Saint Paul's advice to be all things to all men".