Last year, Morningstar—a leading provider of financial services—came under fire because its subsidiary, a company called Sustainalytics, had been systematically giving low “environmental, social, and governance” (ESG) ratings to companies that do business with Israel. Investors have come to rely on ESG ratings as a way of reassuring themselves and their clients that their money isn’t being used unethically. As a result, Morningstar announced last month that it had taken a series of steps to avoid further hostility toward the Jewish state. In an in-depth analysis, Richard Goldberg argues that there is reason to believe the underlying problems have not disappeared. In fact, Goldberg suggests, Sustainalytics seems to be acting in a way that supports the campaign to boycott, divest from, and sanction the Jewish state (BDS).

A core premise of the BDS campaign has permeated Morningstar Sustainalytics’ ESG risk assumptions: east Jerusalem, the entirety of the West Bank, Gaza, and the Golan Heights are deemed Occupied Palestinian Territories (OPT) where Israel is [supposedly] committing systemic human-rights violations against Palestinians, and all companies operating in these areas are—based simply on their location—at risk of contributing to human-rights abuses. This presumption of human-rights risk triggers the company’s incident team to investigate companies operating in or around these territories for controversy ratings.

In a document responding to questions on why an Israeli telecommunications company operating in the West Bank received a “Category 3 Significant controversy” rating, Sustainalytics wrote, “Our perspective is that the current operations in the Occupied Territories create an unmanageable human-rights risk for the company.” That presumption upends the Oslo Accords, however, which allowed for an Israeli presence in various parts of the West Bank and which envisioned Israel retaining portions of the West Bank. Notably, the presumption that any Israeli presence beyond Israel’s 1967 border is a human-rights violation is one of the same presumptions used by the BDS campaign.

This approach leads to the infliction of harm on Israeli and Israel-connected companies. Israeli banks, for example, receive a Category 3 Significant controversy rating simply for providing services to Jews living in parts of Jerusalem—the capital of the Jewish state and home to the Western Wall — or the disputed West Bank.

Most likely, it was the Israeli Air Force that attacked eastern Syria Monday night, apparently destroying a convoy carrying Iranian weapons. Yoav Limor comments:

Israel reportedly carried out 32 attacks in Syria in 2022, and since early 2023 it has already struck 25 times in the country—at the very least. . . . The Iranian-Israeli clash stands out in the wake of the dramatic events in the region, chiefly among them is the effort to strike a normalization deal between Israel and Saudi Arabia, and later on with various other Muslim-Sunni states. Iran is trying to torpedo this process and has even publicly warned Saudi Arabia not to “gamble on a losing horse” because Israel’s demise is near. Riyadh is unlikely to heed that demand, for its own reasons.

Despite the thaw in relations between the kingdom and the Islamic Republic—including the exchange of ambassadors—the Saudis remain very suspicious of the Iranians. A strategic manifestation of that is that Riyadh is trying to forge a defense pact with the U.S.; a tactical manifestation took place this week when Saudi soccer players refused to play a match in Iran because of a bust of the former Revolutionary Guard commander Qassem Suleimani, [a master terrorist whose militias have wreaked havoc throughout the Middle East, including within Saudi borders].

Of course, Israel is trying to bring Saudi Arabia into its orbit and to create a strong common front against Iran. The attack in Syria is ostensibly unrelated to the normalization process and is meant to prevent the terrorists on Israel’s northern border from laying their hands on sophisticated arms, but it nevertheless serves as a clear reminder for Riyadh that it must not scale back its fight against the constant danger posed by Iran.