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RESOURCES
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Supporting Good BusinessOur Diet We want to address some of the more intensive ways that we may support good and humane business other than through our "dollar votes" (the easiest and most direct method). For those seeking employment or just investment in a good company, there are a number of resources that will give valuable information. Even if we are not seeking employment, we may meet others, particularly young folks, who are and may then be able to share these resources with them.
Investment is a powerful tool in social change and with the democratization and proliferation of small investors resulting from Internet investing, it has become extremely powerful as an agent of change. Socially Responsible Investment refers to the selective and strategic placement of savings, retirement or investment for any reason in companies that have been screened for certain criteria. The Domini Social Index is a good example and an established benchmark for the application of social criteria (or screens) to investment decisions on investments, such as stocks, bonds, and mutual funds The criteria from the Domini 400 Index Fund are as follows (from their web site): Domini does not invest in companies that manufacture tobacco, alcohol, nuclear power, supply services to gambling operations, or derive more than 2% of gross revenues from the production of military weapons. We seek to invest in companies with the following qualities:
Screening criteria will vary with the company and the goals of the fund. There are a full spectrum of socially screened funds available from a large number of mutual funds such as Calvert, Citizens Funds, Parnasus, Domini, Green Century, and Pax Funds, to name just a few. Their performance and risk / return factors are very competitive with the world of non-screened funds. The home page to reference resources, financial advisors specializing in screened funds, fund performances, company research, screening criteria for each fund and much more is www.socialinvest.org Another tool available for fostering change in the business community is Shareholder Activism. Any shareholder of any publicly held company may communicate with the management of that company regarding policies and practices of that company via E mail, letter or phone. Even more effective is investors networking to collective work with management on the same issues. The final and most powerful option is the Shareholder Resolution. A shareholder Resolution may be generated by any shareholder who has owned more than $2000 in a company's stock for longer than one year. It must be less than 500 words and meet some other criteria established by the Security Exchange Commission of the Federal government. Its validity may be challenged in court by the company, but once accepted, copies and ballots must be printed and mailed to all shareholders. A 3% affirmation vote will assure a second vote the following year, and a 5% vote the second year will assure a third vote the next year. Votes that approach 15% to 20% of all shares receive excellent press coverage, are very powerful messages to company management and are not typically ignored. For more information on shareholder activism log onto the Shareholder Action Network home page at www.shareholderaction.org Also visit the site of the Interfaith Center on Corporate Responsibility at www.iccr.org. Interfaith Center on Corporate Responsibility has been a leader of the corporate social responsibility movement for nearly thirty years. ICCR's membership is an association of 275 Protestant, Roman Catholic and Jewish institutional investors, including national denominations, religious communities, pension funds, endowments, hospital corporations, economic development funds and publishing companies. Each year ICCR-member religious institutional investors sponsor over 100 shareholder resolutions on major social and environmental issues. The combined portfolio value of ICCR's member organizations is estimated to be $110 billion. According to the IRRC (Investor Responsibility Research Center), there was a substantial increase in shareholder resolutions for the 2000 proxy season. Out of 108 socially-oriented proposals, over 90% exceeded the 3% of the vote required to submit again in 2001. The highest performing resolutions call on companies to diversify their boards of directors. At American Power Conversion, the vote was 30.1% in favor. The second highest level of support went to resolutions calling on companies to implement the MacBride Principles in Northern Ireland. Resolutions on genetically modified organisms (GMOs) were hot this past year, filed with 21 companies (2000 was the first year for GMO resolutions - there have been 51 filed so far in 2001). They commonly called on companies - such as Monsanto, Coca-Cola, McDonald's, Campbell's, Heinz, General Mills, and Kellogg - to stop sales of products with GM ingredients pending further safety tests. [Votes garnered an average of 4%.] Among other environmental shareholder resolutions, "Report on global warming emissions & misinformation" was the most popular, with 11 resolutions. Companies included Alleghany Energy (8.87%), Chevron (8.7%), and Eastman Chemical (7%). Shareholders withdrew resolutions from Duke Energy, Cinergy, Goodyear and Texaco when they agreed to enter into discussion. "Endorse CERES principles" was also popular, gathering about 9.9% of the vote at Aetna, Allstate, Dana, and Whirlpool. Niagara Mohawk shareholders voted in favor by 18.7%; at Lilly, the resolution received only 4.7%. Resolutions at Alcoa and Hasbro were withdrawn pending discussion. BP Amoco (13.5%), Chevron (7.1%) and ExxonMobil (5.4%) were asked to "Cancel Drilling in Arctic National Wildlife Refuge." Other shareholder resolutions filed in 2000 were:
There were 8 social resolutions filed with ExxonMobil this year. All received enough votes to be resubmitted again next year. Here are a few of them: Government Service Received 4.5%. Asks the company to disclose when executives of the company were previously employed by the government. Policy on Board Diversity Received 9.7%. Asks for a policy that would encourage diversity on the board of directors. Executive Pay and Downsizing Received 9.4%. Asks company to adopt a policy that freezes the pay of executive officers during times of downsizing. Executive Compensation Factors Received 9.5%. Asks the Board Compensaton Committee to consider social and environmental factors and performance of company when determining executive pay. Additional Report on ANWR Drilling Received 9.6%. Asks company to prepare a report on potential environmental damage that would result from drilling in the Arctic National Wildlife Refuge. Renewable Energy Sources Received 8.9%. Asks company to adopt a policy that encourages greater investments in renewable energy technologies. Some recent successes in shareholder resolutions: Home Depot to Phase-Out Old-Growth Timber In August 1999, Home Depot, the world's largest seller of old-growth timber, announced its intent to phase-out the sale of wood products from "endangered forests." The company said it will eliminate from its stores wood from endangered areas, starting with "lauan, redwood and cedar products," by 2002. Home Depot had been under growing pressure from shareholders and environmentalists to stop selling old-growth wood. The As You Sow Foundation managed a solicitation campaign for a shareholder resolution, co-filed by the Educational Foundation of America and Trillium Asset Management. The resolution, which called for a report on phasing-out sales of old-growth wood, received the support of 11.8% of all shareholders (113 million shares) at the company's annual meeting in May. This is more than double the 5% average support that such environmental resolutions routinely receive at annual meetings of publicly traded companies. Baxter International to Phase-Out PVC Products. In ICCR's biggest victory of the year, Baxter International, the world's largest health care products manufacturer, agreed to phase-out polyvinyl chloride (PVC) materials in its intravenous health care products. Present in 25% of health care industry products, PVCs release dioxin, one of the most toxic substances on Earth, when manufactured and incinerated. Recent studies also suggest phthalates, toxic substances added to soften vinyl products, leach into solutions administered to patients through intravenous bags and tubing. DuPont Will Not Strip Mine the Okefenokee.
ICCR members and environmental groups persuaded chemical giant E.I.
DuPont de Nemours to abandon plans to strip mine along the Okefenokee
National Wildlife Refuge in southeastern Georgia. Religious shareholders
withdrew a shareholder resolution after DuPont signed a no-mining
agreement with local and state governments, environmental and community
groups, and private landowners. Sara Lee Corp. Sells Tobacco Business Under pressure from religious shareholders and the medical profession. Sara Lee Corp. sold its Drum rolling tobacco business and severed its ties to the tobacco industry. Its tobacco business generated about $300 million in annual sales. Sara Lee had been a focus of religious investor pressure for more than two years. RJR Discontinues Joe Camel Ads. RJR Nabisco announced plans to discontinue its Joe Camel ads worldwide. The controversial ads, widely denounced because of their marketing to minors, increased Camel sales among teenagers from $6 million in 1988 when the campaign began, to $476 million in 1992. Shareholder advocates had challenged tobacco industry marketing practices for nearly a decade. Harley-Davidson Withdraws Name from Tobacco Ads. Harley-Davidson Inc. announced it would no longer permit use of its name by the tobacco industry. The company had been criticized by ICCR members and medical professionals for licensing its name to Loew's Corp., which sold a Harley-Davidson cigarette. Companies End Use of Racist Logos and Ads. ICCR members and American Indians commended Great Atlantic & Pacific Tea Co. (A&P) for removing from its shelves products with racially offensive logos and images. After dialogue with shareholder activists and American Indian representatives, Anheuser-Busch, Philip Morris Co. (parent company of Miller Beer), GTE and Denny's Restaurants discontinued use of the controversial "Chief Wahoo" logo of the Cleveland Indians major league baseball team. When U.S. television news revealed American corporations using racist images of African Americans to advertise products on South African and Japanese television, ICCR members persuaded Goodyear, Procter & Gamble and Pepsico to end the racially offensive ads. Mortgage Lenders Agree to Increase Lending to Underserved Communities. Religious investors want equal access to home ownership financing and insurance for low income and minority communities. In dialogue with shareholder advocates, U.S. mortgage lenders and insurance companies reported extensively on their mortgage lending and insurance policies in underserved communities. The three largest mortgage companies, making one-fifth of all new mortgage loans in the U.S., are striving to raise their exposure in minority and low-income communities to industry level. Pepsico Withdraws from Burma. The biggest victories of the 1997 proxy season involved major corporate withdrawals from Burma. In January 1997, Pepsico announced its complete withdrawal, a move long-sought by an international coalition of students, human rights activists, religious shareholders and Burmese exiles. Nine months later, Texaco followed suit, divesting its holdings in Burma's strategic natural gas industry, a major victory for restoring democracy to Burma. Oil and gas company investment provides the largest legal source of foreign currency to Burma's military dictators. Sara Lee Corp. Stops Advertising Tobacco. In July 1997, Sara Lee Corp. revealed plans to stop all consumer advertising of tobacco products in the U.S. Sara Lee had marketed Drum, a leading rolling tobacco, using the anti-establishment theme: "Drum Your Own Rhythm," through its Dutch-based subsidiary. Stone Container Co. Considers Totally Chlorine-Free Papermaking Process. Responding to a resolution by religious shareholders, Stone Container agreed to conduct tests and feasibility studies to see how totally chlorine-free (TCF) bleaching might work in the company's paper manufacturing. Stone Container is the first major U.S. company in the industry to seriously consider the TCF alternative. GM Chairman Meets with Mexican Maquiladora Worker. In May, religious shareholders and a General Motors Corp. assembly worker from the Delnosa plant in Reynosa, Mexico sat down for a face-to-face meeting with GM Chairman/CEO John F. (Jack) Smith prior to the company's annual meeting. Arranged by shareholders who believe it is essential for workers to speak for themselves, directly to GM's top decision-makers, the historic meeting is believed to be the first meeting between the auto giant's top officer and a Mexican assembly-line worker. The meeting stressed the burdens of workers attempting to survive on the 90 cents an hour GM pays them. GM is the largest private sector employer in Mexico. Top of page |