SEC's Rejection Of Intel: Its Significance For The Holy Land Principles

WASHINGTON, Feb. 16, 2015 /PRNewswire-USNewswire/ -- The SEC's rejection on February 11 of Intel's attempt to exclude the Holy Land Principles resolution from its 2015 Proxy Material is an important victory in and of itself. But of equal significance is why Intel's main argument was over-ruled.

That is how the President of the Holy Land Principles, Inc. reacted to the precedent-setting ruling. Fr. Sean Mc Manus explained: "Intel petitioned the SEC that our Proposal/Resoluion could 'properly be excluded from the 2015 Proxy Materials pursuant to: Rule 14a-8(i)(7) because the Proposal relates to the Company's ordinary business operations.'

Then Intel argued: 'The [the Holy Land Principles] Proposal requires the Company's board of directors to make all possible lawful efforts to implement the Holy Land Principles, including a principle, outlined in paragraph 7 of the Proposal, not to 'accept subsidies, tax incentives or other benefits that lead to the direct advantage of one national, racial, ethnic or religious group over another [Principle # 7].' "

Fr. Mc Manus continued: "Intel then, thinking it was delivering a knockout blow to the Holy Land Principles, declared, 'As a result, by seeking to address the Company's evaluation of subsidies, tax incentives or other benefits, the Proposal interferes with the Company's ordinary business...' "

Fr. Mc Manus explained: "But the SEC was not buying the specious argument, ruling: 'We are unable to concur in your view that Intel may exclude the proposal under rule 14a-8(i)(7). Accordingly, we do not believe that Intel may omit the proposal from its proxy materials in reliance on rule14a-8(i)(7)'."

INTEL'S CEO — Brian Krzanich

"Fr. Manus pointed out: 'This must surely pose a real dilemma to Mr. Brian Krzanich, CEO of Intel Corporation, who promised on January 6, 'It's time to step up and do more. It's not good enough to say we value diversity and then have our workplaces and our industry not reflect the full availability and talent pool of women and underrepresented minorities.'

Last September Intel announced a $6 billion investment (for which it got$300 Million in government grants) in Israel, where "underrepresented minorities" in the hi-tech workplace have been acknowledged by such industry leaders as Cisco in their 2012 Corporate Sustainability Report:

'Arab citizens constitute 20 percent of the population in Israel, but make up less than 0.4 percent of the high-tech industry workforce.' Such 50:1 inequality of outcomes for Israel's Arab citizens, if operative instead for African- Americans, would read 'Black citizens constitute 12 percent of the population of the United States, but make up less than 0.24% of the high-tech industry workforce.' Bloomberg Newsweek also exposed the problem in its November 26, 2014 article entitled 'What it's Like to Be an Arab Entrepreneur in a Divided Israel.' Bloomberg reported that Jamil Mazzawi upon graduation from Technion, Israel's preeminent technology university, sent out resumes but "he didn't hear back from a single employer – a story common among Arab engineers."

LACK OF GOOD FAITH

Fr. Mc Manus said: "In view of the indisputable fact that American hi-tech companies have this problem, surely signing the Holy Land Principles would be, at the very least, an expression of good faith and a first step? However, instead, Intel not only refused to sign the Holy Land Principles, but also petitioned the SEC to exclude them. That surely did not demonstrate good faith. Intel tried to block the good faith efforts of the Holy Land Principles by appealing to a U.S. government agency. To its credit, the SEC would not allow itself to be complicit in opposing fair employment principles for underrepresented minorities— minorities that CEO Krzanich promised to help. The SEC's decision further validates my constant theme that the Holy Land Principles are pro-Jewish, pro-Palestinian and pro-company. The Principles do not call for quotas, divestment, disinvestment or boycotts."

RUGGIE PRINCIPLES

Fr. Mc Manus continued: "Intel's lack of good faith would seem to be raised by its professing to adhere to the United Nations' Guiding Principles on Business and Human Rights (GPBHR), also known as the Ruggie Principles. This framework states that 'Some of the worst human rights abuses involving business occur amid conflict over the control of territory...'which surely is the case with Israel's settlements in the Occupied Palestinian Territories. It further imposes on Intel the responsibility to 'avoid causing or contributing to human rights impacts through their activities,' and surely discrimination against underrepresented minorities inside Israel is such an impact. And finally, GPBHR says businesses have a responsibility to 'identify, prevent, mitigate and account for how they address their impacts on human rights,' which is exactly what the Holy Land Principles seek of Intel." Intel is Israel's largest private sector employer, with over 10,000 employees. Since Israel's Occupation of the West Bank in 1967, Intel has invested $10.8 billion in plants and development centers in Israel, and received $1.5 billion in related grants (Reuters, September 22, 2014). Intel's operations and ability to offer fair and equal employment in Israel are inevitably complicated by Israel's settlements. Israel's Arab Christians and Muslims are denied equal access to these settlements due to Jewish-only roads and Jewish-only residency requirements. Due to their strategic importance, Israel designates these settlements as Priority A Zones, and offers significant incentives to corporations to invest there. For example, direct grants are available for up to 24% of capital investment, and tax benefits are available for seven years. If the investor is foreign (non-Israeli), this tax benefit will consist of a total exemption from income tax for seven years. ("In Vest in Israel" website).

Fr. Mc Manus concluded: "Approximately 10% of Israel's workforce lives in such settlements – but not Israeli Arabs. That is why the Holy Land Principles argued before the SEC: 'In summary, tax subsidies are available for the construction of facilities in the settlements, but since Palestinians, as a practical matter, are unable to commute to the jobs created by such facilities, accepting the subsidies results in de facto job discrimination against the Palestinians. Consequently, Principle #7 relates directly to the problem of discrimination in employment.'"

Fr. Sean Mc Manus
President
Holy Land Principles, Inc.
P.O. BOX 15128
Capitol Hill
Washington, DC 20003-0849
Tel. 202-488-0107
Fax. 202-488-7537
[email protected]

SOURCE Holy Land Principles, Inc.