Australian fund managers who continue to invest in companies that supply weapons to Israel are likely to be in direct breach of international law and risk prosecution. Stephanie Tran with the story.
Leading international law experts say Australia’s sovereign wealth fund could be complicit in genocide in Gaza if they continue investing in companies supplying weapons and technology to Israel.
Former Australian Human Rights Commissioner Chris Sidoti, who was a member of the UN Commission of Inquiry on the Occupied Palestinian Territory, told MWM that both the government and private sector have clear obligations to avoid complicity in genocide.
“States like Australia, and the private sector too, are now on notice,” Sidoti said. “A UN Commission of Inquiry has found war crimes, crimes against humanity and the crime of genocide, and they have responsibilities arising from that.”
Tim McCormack, Professor of International Law at the University of Tasmania and former Special Adviser on War Crimes to the International Criminal Court, said the government must confront the legal implications of its inaction.
“We need a government that’s prepared to say we believe in the international legal order, and that means certain implications for us about having to draw lines in the sand when we see international law being violated egregiously,” he said.
Future Fund complicity
The Future Fund, Australia’s sovereign wealth fund, continues to hold shares in Elbit Systems despite extensive evidence that the Israeli weapons manufacturer is a key enabler of the IDF in the commission of genocide in Gaza as Israel’s largest weapons manufacturer.
Future Fund invested in Israeli company Elbit Systems – whose bombs are raining on the Palestinians
During a Senate Estimates hearing last month, Future Fund CEO Raphael Arndt and Chief Corporate Affairs Officer Will Heatherton were grilled about why the fund still invests in Elbit, whose drones are believed to have been used in the Israeli strike that killed Australian aid worker Zomi Frankcom.
Elbit Systems was added to the Fund’s exclusion list in 2018 for producing cluster munitions but was reinstated in April 2023 after what Heatherton described as a process of “due diligence, review and testing.”
“Through our process of regular due diligence, review and testing – as I mentioned, every six months – in 2023 it was identified that Elbit Systems was no longer involved in the activities that led it to be taken out of the portfolio, so it became investable once again,” said Heatherton.
Elbit Systems risk
When pressed about the concerns raised by several UN reports regarding the complicity of Elbit Systems in genocide, Heatherton stated that under the board’s policy “there is no reason to exclude the company, on the basis of conventions and treaties the Australian government has ratified”.
“In this particular case, Elbit is not subject to Australian or US sanctions and is not excluded under the exclusions framework adopted by the board,” he said.
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Open in new tab Sidoti said the Fund’s position exposed deep flaws in how it applies ethical and legal standards to its investments.
“If the statements made by the senior people in the Future Fund are correct, then, firstly, there needs to be a complete change in the membership of the board, and secondly, there needs to be a change in the legislation to make sure that the Future Fund acts lawfully under international law and ethically.”
Sidoti pointed to the Norwegian Sovereign Wealth Fund as an example of a fund that has aligned its investment strategy with its obligations under international law. The Norwegian Sovereign Wealth Fund banned investments in Elbit Systems in 2009 due to its supply of surveillance technology to Israeli forces in the West Bank. In August, the fund also terminated all contracts with asset managers handling its Israeli investments.
“If the largest fund in the world can act ethically and be concerned about acting ethically, why can’t a relatively small one like ours? If the board can’t ensure that that occurs, then the legislation needs to be changed. It is an institution that is part of the state, and so it bears the responsibilities under international law that the state bears far more than any private corporation,” Sidoti said.
Australia … “a very real risk”
Sidoti warned that the Australian government may be in breach of its obligations under international law due to its inaction after the International Court of Justice (ICJ) ruled that it was “plausible” that Israel’s acts in Gaza could amount to genocide.
“There is a very real risk that Australia is breaching its international legal obligations. I’m not saying at this stage that we are definitely in breach, but from what the Australian government has said and done in response to the situation in Gaza and in response to decisions already made by the International Court of Justice, I have to say that we are at real risk of being in violation of international law the court.”
He said the government had failed to implement even basic steps to ensure it is not aiding or assisting Israel’s unlawful activities.
“I would have expected Australia to undertake a major review of all aspects of its relationships with Israel… but I am not aware of any such comprehensive review having been undertaken.”
“The [ICJ] have said that all states have an obligation not to aid or assist the continuation of Israel’s unlawful activities in the occupied Palestinian territory. The first step of not aiding and assisting is to know exactly what we’re doing, the aspects of the relationship and what we should be stopping. But that doesn’t seem to have been done.”
Jerusalem defence and trade office
Sidoti also called for the immediate closure of Australia’s defence and trade office in Jerusalem, which promotes cooperation with Israel’s arms industry.
“To have that office still operating and promoting defence cooperation is nothing short of scandalous. It is absolutely scandalous that under these circumstances, we are promoting defence cooperation between Australia and Israel,” he said.
Between March 2019 to June 2025, Austrade paid WeWork Israel $218,115 to lease the premises for the West Jerusalem Trade and Defence office. In July 2025, the lease was extended until December 2025 for a further $26,185.
While the government maintains a ban on arms exports to Israel, Sidoti said the government’s continued defence contracts with Israeli weapons manufacturers such as Elbit Systems fund the development of weapons and surveillance technology used against Palestinians.
“The Australian government is hiding behind the fact that for five years it has had a prohibition on the export of arms and munitions to Israel.”
“But when we buy drones or surveillance technology from Elbit, we are, in fact, funding research and development of the Israeli armaments industry, and in particular the development of surveillance technology that is used against Palestinians. There is no excuse whatsoever for any form of arms trade between Australia and Israel.”
McCormack added that Australia’s participation in the supply of components for the F-35 stealth strike fighter programme continues to implicate us in the atrocities committed in Gaza.
“We know those aircraft … are being used to drop incredible amounts of ordnance on Gaza,” he said.
Obligation to prevent genocide
Sidoti said Australia’s legal duty to prevent genocide was triggered in January 2024 after the ICJ ruled that genocide in Gaza was ‘plausible’. Under the Genocide Convention, states have an obligation not only to punish genocide after it occurs, but to actively prevent it. The ICJ’s ruling activated this obligation, requiring states to use all means reasonably available to them to prevent genocide from happening.
“The critical legal issue is the obligation to prevent genocide; that obligation is not dependent on genocide having actually occurred, it is triggered by a reasonable risk that genocide may occur,” he said. “The obligation to prevent is a real and present obligation that has existed at the latest, since January 2024, yet we seem to have done very little, and certainly almost nothing meaningful in response to that obligation.”
In September, the UN Commission of Inquiry on the Occupied Palestinian Territory found that Israel has committed and is continuing to commit genocide in the Gaza Strip.
“Our UN Commission of Inquiry has been looking closely at the situation in Palestine and Israel for four years now, and we’ve focused particularly on the situation in Gaza for the last two years. … In a series of reports, eight in all, we found war crimes, crimes against humanity and most recently, based upon all of our earlier findings, the crime of genocide,” Sidoti said.
Chris Sidoti will be speaking in a series of public events organised by the Association for the Promotion of International Law in conjunction with Amnesty International, ANU Law School and the International Commission of Jurists. He will be in Victoria on 19 November, Hobart on 20 November and Sydney on 27 November.
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