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.

On Tuesday, a Hizballah drone attack injured three people in northern Israel. The next day, another attack, targeting an IDF base, injured eighteen people, six of them seriously, in Arab al-Amshe, also in the north. This second attack involved the simultaneous use of drones carrying explosives and guided antitank missiles. In both cases, the defensive systems that performed so successfully last weekend failed to stop the drones and missiles. Ron Ben-Yishai has a straightforward explanation as to why: the Lebanon-backed terrorist group is getting better at evading Israel defenses. He explains the three basis systems used to pilot these unmanned aircraft, and their practical effects:

These systems allow drones to act similarly to fighter jets, using “dead zones”—areas not visible to radar or other optical detection—to approach targets. They fly low initially, then ascend just before crashing and detonating on the target. The terrain of southern Lebanon is particularly conducive to such attacks.

But this requires skills that the terror group has honed over months of fighting against Israel. The latest attacks involved a large drone capable of carrying over 50 kg (110 lbs.) of explosives. The terrorists have likely analyzed Israel’s alert and interception systems, recognizing that shooting down their drones requires early detection to allow sufficient time for launching interceptors.

The IDF tries to detect any incoming drones on its radar, as it had done prior to the war. Despite Hizballah’s learning curve, the IDF’s technological edge offers an advantage. However, the military must recognize that any measure it takes is quickly observed and analyzed, and even the most effective defenses can be incomplete. The terrain near the Lebanon-Israel border continues to pose a challenge, necessitating technological solutions and significant financial investment.