CATERPILLAR Caterpillar Inc. Chairman & CEO Jim Owens Employees worldwide 93,229 Sales and revenues (2004) $30.3 billion Profits (2004) $2.0 billion Total assets $36.4 billion Branch stores and retail outlets 3,000 in 180 countries Subsidiaries FG Wilson, MaK, Perkins, Solar Caterpillar UK Ltd 16 facilities UK employees 10,000 Caterpillar and its wholly owned UK subsidiaries have 10 offices in the UK: N Caterpillar (UK) Building Construction Products, Leicester N Perkins Engines, Peterborough N Caterpillar Defence Products UK and Perkins Engines, Shrewsbury N Perkins Engines, Stafford N Caterpillar Logistics Services, Desford N FG Wilson, Larne N FG Wilson, Monkstown/ Springvale N Caterpillar, Peterlee N Turner Powertrain Systems,Wolverhampton N Caterpillar Electronic & Electrical Systems, Peterborough N Caterpillar website: www.cat.com N Caterpillar military products: www.catdfp.com N UK dealer: www.finning.co.uk Introduction This is the first in a new series of War on Want alternative company reports.Their purpose is to compare and contrast the rhetoric of corporate social responsibility (CSR) with the reality of companies’ actual practices.The reports form part of War on Want’s ongoing campaign for a global framework of corporate regulation, and each recommends action that ordinary people can take to rein in the power of multinational corporations across the world. This report looks at the international construction company Caterpillar, and in particular its operations in the Occupied Palestinian Territories. Caterpillar is the largest UK employer in the earth moving and construction industry, and is known on the high street for its range of rugged boots and fashion accessories.As a company, Caterpillar claims to maintain “a strong focus on social responsibility”, while its Code of Worldwide Business Conduct boasts “high ethical standards” through which Caterpillar should “set an example for others to follow”. Yet Caterpillar’s armoured bulldozers have been responsible for the destruction of thousands of Palestinian homes, schools, wells and olive groves. Caterpillar’s bulldozers have also been used in the construction of the Separation Wall which Israel has built on Palestinian land and which has been ruled illegal by the International Court of Justice.As a result of this involvement in the abuse of Palestinians’ human rights, Caterpillar has been subject to unprecedented criticism from the United Nations and international human rights groups. This report not only reviews Caterpillar’s record over and against its rhetoric on corporate social responsibility. It also recommends action, both to send a message to Caterpillar and to redress some of the damage inflicted on the Palestinian people through the company’s involvement.This is War on Want’s mission more widely: to support people in developing countries in their fight against the root causes of poverty, but also to inform and inspire people in rich countries to challenge the global structures which sustain poverty across the world. Louise Richards Chief Executive,War on Want CATERPILLAR: THE ALTERNATIVE REPORT 1 Caterpillar Bulldozers in Palestine “We are doing well by ‘doing good’ all around the world.” Jim Owens, Caterpillar Chairman & CEO Caterpillar is a global corporation, with its Palestinian Territories in 1967.Their use has headquarters in Illinois, USA.According to its come to international public attention in three corporate literature it is the world’s largest major incidents: (i) the destruction of the Jenin manufacturer of construction and mining refugee camp in April 2002 during Operation equipment, yet its machinery has also been Defensive Shield; (ii) the killing of peace used in military operations over several activist Rachel Corrie in March 2003; and decades. From the Vietnam War onwards, (iii) the destruction of homes, roads and Caterpillar’s bulldozers have been used for agricultural land in Rafah during Operation land clearance and other military purposes. Rainbow in May 2004. Caterpillar bulldozers Indeed, the bulldozers have become the have also been used in clearing ground and company’s single most recognisable product. demolishing buildings for the construction of Israel’s illegal Separation Wall, over 100 miles Caterpillar’s bulldozers have been used by the of which (out of a projected total of 450 Israeli military since its occupation of the miles) have already been built. The context: Israel’s military occupation of the Palestinian Territories Israel occupied the Palestinian Territories of the West Bank and Gaza Strip in October 1967, and has now maintained its military occupation of the territories for over 37 years.This is despite UN Security Council resolution 242 of 22 November 1967 calling for the withdrawal of Israeli armed forces from the territories, a call which has been reiterated by the UN on a regular basis ever since. Since September 2000, Israel has intensified its action against Palestinians living under the occupation, leading to a human rights crisis.According to the Israeli human rights centre B’Tselem, a total of 3,189 Palestinians were killed from September 2000 to the end of 2004, including 617 children; this is against 940 Israelis killed in the same period, including 167 children. In addition, 5,794 Palestinians – including 373 children – were being held in Israeli custody at the end of 2004, of whom 863 were being held without charge or trial, and with no release date. 2 CATERPILLAR: THE ALTERNATIVE REPORT Caterpillar’s bulldozers are currently used in primary weapons are a front-fitted blade and a almost every significant operation by Israeli rear ‘ripper’ blade intended for use in forces in the Occupied Palestinian Territories. loosening ground. According to one Israeli military commander, Caterpillar bulldozers are “the key weapon”.1 Once supplied by Caterpillar, the bulldozers D9s, the most commonly used bulldozer, have are modified by Israeli Military Industries, a been used extensively in house demolitions, state-owned Israeli arms manufacturer, and the destruction of Palestinian infrastructure Israel Aircraft Industries’ Ramta division. Some and agricultural land, and in urban warfare bulldozers have customised packages including support.The Israeli army currently has around machine gun mounts, smoke projectors and 100 D9s in operation. grenade launchers. In addition, the Israeli army uses three types of Caterpillar Wheel Loaders, The Caterpillar D9 weighs 53.8 tons, with a which are also modified in Israel for military height of 3.96m and length of 8.13m.This purposes.2 Reports of 16 armoured makes it as tall as a double decker bus and as Caterpillar D9s being used in Iraq shows that heavy as a tank. Powered by a 410- lessons from the Occupied Palestinian horsepower engine, it can easily demolish a Te r ritories are being employed in other house, orchard or olive grove.The D9’s conflict zones.3 Caterpillar D9 bulldozers in Palestine Photo: Reuters/Gil Cohen Magen Demolition of Homes, Farms and Land “We believe that our success should also contribute to the quality of life and the prosperity of communities.” Caterpillar’s Code of Worldwide Business Conduct, p12 According to the UN, a total of 4,170 agricultural fields planted with crops, as well as Palestinian homes were destroyed by the numerous Palestinian homes and sometimes Israeli army between September 2000 and human lives” (see p10 for more on this letter). December 2004.4 The Israeli Committee The Israeli military has also destroyed Against House Demolitions states that Israel hundreds of public buildings and commercial has demolished almost 12,000 Palestinian properties in the Occupied Palestinian homes since 1967, leaving some 70,000 people Te r ritories over the past four years, as well as without shelter and traumatised.5 The vast areas of agricultural land. During a period Caterpillar D9 is the main tool used by the of just two weeks from 29 March to 11 April Israeli military to demolish homes, 2002, 11 Palestinian schools were completely infrastructure and agricultural land in the destroyed and nine more vandalised.7 Occupied Palestinian Territories. Agriculture is the only source of livelihood for The usual reason given by the Israeli most Palestinians. Caterpillar bulldozers have authorities for demolitions has been punitive uprooted extensive areas of cultivated land, action against the family homes of Palestinians including hundreds of thousands of olive, engaged or suspected of engagement in armed citrus and other trees, crops and vegetables. activities against Israel. Even if true, this Olive trees in particular need many years to practice is illegal under international grow before they become productive, so humanitarian law, as all destruction of destruction of olive groves has significant and property which is not rendered absolutely far-reaching consequences for Palestinian necessary by military operations is a breach of livelihoods.The period between October 2000 Article 53 of the Fourth Geneva Convention and December 2001 alone saw the (to which Israel is a party).Yet a recent destruction of 454,541 trees.8 B’Tselem report cited by the UN shows that 47% of houses destroyed by the Israeli Hundreds of wells, water storage pools, tanks military were never home to anyone and electrical water pumps have also been suspected of involvement in attacks destroyed, severely limiting access to drinking upon Israelis.6 water.The irrigation network has also been severely damaged. During the Israeli army’s In May 2004, the UN Special Rapporteur