Section:
csr
Annual Summary of Shareholder Engagement
2007-2008
The following action summaries and the chart of activities will give an insight into our shareholder engagement for 2007-2008.
HUMAN RIGHTS
Chevron: As co-filers of a resolution with the Wisconsin Jesuit Province and other shareholders, we are asking this transnational corporation that operates in countries with repressive governments, ethnic conflict, and poor labor and environmental standards to become more transparent and adopt a comprehensive, verifiable Human Rights Policy. At our last dialogue we experienced only minimal success.
Coca Cola: We continue to have productive meetings with Coca Cola representatives covering a wide range of issues. Coca Cola is working with us and other stakeholders on their strategic plan to include policies for community engagement, independent monitoring and a clear mandate that all their bottlers be required to follow human rights policies. Our most recent dialogue indicated that Coca Cola has taken definitive steps to becoming a leader in corporate social responsibility.
Starwood Hotels: Our dialogues with Starwood have been most successful in light of the fact that they have developed a Human Rights Policy and included in it a section the rights of children. They are also willing to work with the ECPAT (End Child Prostitution, Child Pornography and Trafficking of Children for Sexual Purposes) organization as they go forward with future education and training.
MILITARISM AND VIOLENCE:
General Electric: Our resolution with General Electric on “Ethical Criteria for Military Contracts” was withdrawn after a constructive dialogue. Several aspects of the resolution were addressed with a promise to continue the dialogue with higher levels of management.
United Technologies: Our resolution with United Technologies dealt with “offsets.” Offsets are significant promises (including technology transfers), made to foreign governments or companies in connection with foreign military sales, intended to off-set U.S. dollar cost of weapons purchased by foreign nations. For the first time in recent history United Technology agreed to dialogue. The dialogue was very informative and educational; however, it was evident that the Department of Defense is in control of issues of transparency.
Boeing, Caterpillar, Lockheed Martin, and Textron: Each year we also file resolutions with these companies related to ethical criteria for military production, offsets and related contract bids. For the most part there is no dialogue due again to Department of Defense contracts.
VIOLENCE IN MEDIA:
Blockbuster, Best Buy, Target, Toys ’R Us, CircuitCity and Wal-Mart: With all of these retail companies we have had successful dialogues around many aspects of sales and promotion of violent video games. We have enabled them to be more responsible in establishing policies both for in-store and internet use that will prevent youth from purchasing M-rated games.
GLOBAL WARMING
ExxonMobil and Chevron: Our resolutions with these corporations ask for a reduction in greenhouse gas emissions and a report to shareholders on their plans to achieve these goals. Chevron has challenged our resolution with the Securities and Exchange Commission, and we are awaiting the SEC’s decision.
General Motors: A resolution was submitted that asked the company to adopt quantitative goals for the reduction of greenhouse gas emissions from both their products and operations. This prompted the company to initiate a dialogue with us in the spring.
ENVIRONMENTAL JUSTICE
Massey: Recently,we engaged the company in an initial dialogue regarding the effects that mountaintop removal (MTR) mining has on local streams and waterways. Although a good first step, we are attempting to continue discussions, with particular focus on their record $20 million fine for water pollution violations.
WATER AND FOOD
Coca-Cola: Our resolution asked the company to report on the effect their 58 plants in India have had on water supplies. In our most recent dialogue with the company, they explained Coke’s on-going efforts in water collection, conservation, and purification. We agreed to withdraw the resolution in exchange for an assurance of continuing dialogues.
CONTRACT SUPPLIERS/VENDOR STANDARDS
Dollar General, Dollar Tree, Gap, Phillip Van Heusen, Jones Apparel, Hewlett-Packard, Target, Wal-Mart and others.
In our dialogues with these corporations we are asking that supply chain monitoring be a major part of the company policy throughout the global community. This policy would be made public and independent monitoring would be part of the process. In recent dialogues with the Gap, Philip Van Heusen and Jones Apparel there is evidence that they have worked hard to see that sustained compliance and workplace standards are effectively promoted at the factory. This issue continues to be a very serious one for all companies who outsource to factories in developing nations. Our dialogues with the Dollar Stores are in their initial stages and indicate no real supply chain monitoring.
As a member of a sub-committee of this area, we are working on research to identify specific “Purchasing Practices.” This committee is focused on improving working conditions in manufacturing facilities by motivating U.S. brands and retailers to integrate effective purchasing practices into their daily business.
ACCESS TO CAPITAL
Citigroup, Freddie Mac, and J.P. Morgan Chase: Our resolutions and dialogues with these financial companies deal with pay disparity, predatory lending, the Community Reinvestment Act, and disclosure of balance sheet liabilities. All of these companies have been open to dialogue, however, we’re not getting the real answers to risk management, ethical and moral compliance and all the “dubious investment instruments” that seem to lead to further volatility.
Well Fargo: There is a long history of cooperative dialogue on many issues with this company, particularly regarding climate change. However, they’ve been less than candid about their loan policies.
ACCESS TO HEALTH CARE
Abbott Laboratories: This company, embroiled in controversy for pulling essential medicines from Thailand after generic licenses were approved, has recently made contact with ICCR to begin a dialogue. However, they have challenged our resolution at the SEC.
Bristol-Myers Squibb: Our resolution asking the companies to publicly support health care reform policies has been withdrawn in favor of a dialogue. BMS supports market-driven proposals to universal health coverage. They are members of the National Health Council, and are focused on health IT (information technology).
Schering Plough: Regarding access to essential medicines in low and middle-income countries, the CEO relates that philanthropy programs are not a sustainable strategy. Building up infrastructure and education, especially in sub-Saharan Africa will give the people the tools to combat the disease.
CORPORATE GOVERNANCE
Cisco Systems: This resolution addressed the issue of excessive executive compensation and holding the CEO accountable for the issue of pay. The vote at Cisco “say on pay” received 48%.
Time Warner: In a recent dialogue, TW representatives agreed to ask board members to meet with us on the issue of the separation of the chair and the CEO. Board members are considering, and we’ve insisted on this as a condition for withdrawal of our resolution.
MEMBER ISSUES:
These issues are addressed by member organizations of ICCR on an individual basis.
ReynoldsAmerican: This resolution speaks to the need for a “basic human rights” protocol for farm workers and others who harvest tobacco for ReynoldsAmerican. “Health problems due to transdermal nicotine absorption are frequent among tobacco harvesters. …(Smitt et.al, Health Risks in Tobacco Farmers, Journal of Public Health, 15:4, August 2007). GTS (Green tobacco sickness) threatens 33 million + tobacco farm workers globally. (World Health Organization)
CircuitCity, J.C. Penney, Sears Holding, Target and Wal-Mart: During the past year we have participated with other shareholders in dialogues with these retail companies with regard to PVC’s (Polyvinyl chloride). Each of these retailers is setting benchmarks/timeframes to phase out products and/or packaging that contain PVC. Some of these products are lunch boxes, shower curtains, infant toys and the packaging of certain products. These retailers are adopting safer alternatives as they become available.
Nora M. Nash, OSF and Tom McCaney
Additional Summaries of Shareholder Engagement (Word.doc 86 kb)
