Thanks to Sr. Ruth Schaaf, O.P. who sent this headline our way: Nun Funds: The Original Impact Investors. The article recounts the origins of what we know today as impact investing. Reading the article, one can only come away impressed with these women who have invested and multiplied the talents (Matthew 25:14–30).
When we saw a recent article (Wisconsin groups to get $12M settlement for natural gas price fixing) from the La Crosse Tribune quoting Sr. Sue Ernster, FSPA, we wanted to bring it to the attention of our SGI members. Sr. Sue adds:
FSPA participated in the lawsuit of the manipulation of natural gas pricing by multiple utilities as another way of how we live out our social justice activities and our values. We see this as an effort to help those whose voices are not represented in this and other situations. We are utilizing the resources we have at our disposal to hold those accountable who were responsible for this price manipulation.
Our hope is that participating in litigation settlements such as these, as well as filing shareholder resolutions with companies, demonstrates that people are paying attention, asking questions and holding them accountable for their actions.
A key tenet of socially responsible investing is the voting of proxies. Proxy voting gives shareholders a say in the workings of corporations, allowing those who own the company to decide on matters of corporate governance. Reviewing both company and shareholder sponsored resolutions is critical in supporting good governance and effective socially responsible practices.
ICCR recently published their 2018 Proxy Resolutions and Voting Guide (download here). This annual Guide has been published since 1974. This year’s Guide outlines the proxy season, contextualizes the 10 issue areas, and provides the language of the 266 resolutions that were filed by ICCR members. It also describes shareholder advocacy and the proxy process (pg 213). They hosted a webinar (slides here; listen here) to provide an overview of the proxy season and profile a few of most important campaigns including: gender pay gap and paid family leave; ethical labor recruitment; methane emissions; pollinator decline; and drug pricing and the opioid crisis. ICCR members have already negotiated 33 substantive agreements with companies, and have withdrawn their resolutions as a result. Successes include:
- Costco agreed to disclose its gender and race-based pay gaps;
- T. Rowe Price has hired a new responsible investing official;
- AT&T agreed to its first-ever disclosure on key sustainability goals;
- Marten and Saia agreed to begin training their drivers to spot human trafficking;
- WEC Energy Group agreed to prepare a 2 degree scenario assessment report (led by School Sisters of Notre Dame).
You are encouraged to use ICCR’s Proxy Resolutions and Voting Guide to vote your proxies or to ask your asset manager to vote them for you.
The Interfaith Center for Corporate Responsibility, with signatures from SGI and 12 of its individual members, sent a letter to the leaders of Congress advocating for “Congress to allow TPS holders to remain in the country and pursue a path to naturalization.”
TPS, temporary protected status, established by Congress in the Immigration Act of 1990, is humanitarian program whose basic principle is that the United States should suspend deportations to countries that have been destabilized by war or catastrophe.
There are approximately 195,000 Salvadorans, 50,000 Haitians, and 2,550 Nicaraguans who are current beneficiaries of TPS status. In addition, there are 5,800 Syrian, 8,950 Nepali, and 57,000 Honduran TPS holders in the United States today. Of the total 10 countries with current TPS designations, approximately 330,000 people (or, adults and children) benefit from TPS. Many have resided in the U.S. for a significant period of time. For instance, more than one-half of El Salvadoran and Honduran, and 16 percent of the Haitian TPS beneficiaries have resided in the U.S. for 20 years or more.
Thanks to our members who individually signed on. May this week have fruitful in deliberations in the U.S. Senate. Again, to read the letter, please visit here.
As requested by members, we will host our next webinar on shareholder engagement in immigration on Friday, February 16th at 10 a.m. (Central time). The webinar will last 90 minutes.
- Review our values and commitments on immigration
- Assess the state of play on policy
- Highlight what some allies are doing
- Encourage deeper investor engagement with our companies around concerns on immigration (e.g., the shareholder letter to JPMorgan Chase concerning investment in private prisons and immigration detention centers)
Feel free to share this invitation with people within your network. For how to join the webinar, please, contact Christopher Cox, our associate director at firstname.lastname@example.org.
We also see many governments failing to prepare for the future, on issues ranging from retirement and infrastructure to automation and worker retraining. As a result, society increasingly is turning to the private sector and asking that companies respond to broader societal challenges. Indeed, the public expectations of your company have never been greater. Society is demanding that companies, both public and private, serve a social purpose. To prosper over time, every company must not only deliver financial performance, but also show how it makes a positive contribution to society.
In the letter, Fink calls on companies to proactively manage environmental, social, and governance matters through deeper board and investor engagement and thoughtful strategy development. Companies, Fink suggests, should act as stewards for all their stakeholders – including employees, customers, and communities.
Public response to the letter has been mixed. While some find a billionaire’s plan to combat inequality to be ironic, hypocritical, and hollow, many, including us here at SGI, hope this call-to-action will have effect.
BlackRock, the world’s largest asset manager with $5.7 trillion in assets under management as of July 2017 (or, put another way, 20% of the U.S. market), is a significant shareholder in all the largest companies, for better or worse. As Bloomberg’s Matt Levine noted:
Pick your least favorite public company — guns or tobacco or oil or opioids or Facebook or whatever you think is doing the most harm to society — and BlackRock Inc. is among the top five holders. Fink’s threat — contribute to society or you’ll lose BlackRock’s support — rings a bit hollow since BlackRock’s index funds can’t sell. (They can vote against directors, sure, but what exactly do you want a gun maker’s directors to do?)
Aside from supporting the ICCR proposal to enhance Exxon Mobile’s climate disclosures, BlackRock has avoided shareholder advocacy in the past. If BlackRock genuinely engages, it has an opportunity to dramatically move the needle in favor of corporate social responsibility.
Statement endorsed by 147 investors representing $3.7 trillion appeals to global brands to recommit to three-year extension to fulfill Accord’s mandate to remediate fire and safety violations in apparel sector.
Members of the Bangladesh Investor Initiative issued a statement today calling on companies sourcing from the Bangladesh apparel sector to renew their commitment to protect worker health and safety by endorsing the three-year extension of the Accord on Fire and Building Safety in Bangladesh (Accord).
The investors, including Seventh Generation Interfaith Coalition for Responsible Investment and its members, say additional time is needed to complete the remediation plans and worker training indicated by audits at the over 1,600 factories covered by the Accord. The statement will accompany letters being sent to the 160 companies that have not yet become signatories to the three-year extension of the Accord, urging them to participate.
The investors are part of the Bangladesh Investor Initiative organized by the Interfaith Center on Corporate Responsibility to press brands and retailers sourcing in Bangladesh to join the Accord and remediate human rights risks in their supply chains. The statement was endorsed by 147 institutional investors that collectively represent $3.7 trillion in managed assets.
Said Henrike Kulmann of Allianz Global Investors GmbH, “The new agreement between global trade unions and companies ensures that the industry continues to remediate safety issues found in garment factories and build effective worker safety committees. They are an important component to mitigating risks to workers and supply chain disruption as well as reputational risks to global brands sourcing in Bangladesh. We call on all companies sourcing from Bangladesh to become Accord signatories to mitigate these serious human rights and business risks.”
For the 1,600 factories have been inspected under the Accord, 82 percent of the identified safety issues have been fixed, the majority of them electrical. “Investors have been particularly pleased to see that, in addition to fixing specific problems, the Accord has worked to address the systemic issues that led to disasters like Rana Plaza,” said Lauren Compere of Boston Common Asset Management, “It is critical to ensure that future safety problems are detected before they become life-threatening events. The detailed comprehensive work achieved by the Accord is a positive signal to investors that safety risks are being carefully and sustainably managed.”
The investor statement recommends brands undertake the following:
- Accord companies, who have yet to sign the 2018 Accord, do so during the first Quarter of this year.
- Companies that were part of the Alliance, which is disbanding in 2018, join the Accord and therefore maximize collective leverage to complete safety reforms and strengthen action to build the capacity of the Bangladesh government’s oversight of worker safety by 2021.
- Brands and retailers sourcing in the garment sector expand safety inspections to knitting, spinning & weaving; washing, dyeing & printing facilities; embroidery & accessories; home textiles; leather and footwear.
- Brands, retailers and other stakeholders strengthen the National Tripartite Plan of Action on Fire Safety and Structural Integrity in Bangladesh’s garment sector to ensure an integrated approach to promoting fire safety and building integrity, and to provide a platform for stakeholders engaged in fire safety initiatives.
“To date, only 60 of the 220 signatories of the Accord have signed the new agreement to extend the program until May 2021,” stated David Schilling, senior program director of ICCR. “While much has been achieved in making garment factories in Bangladesh safer, there is more to be done, including the establishment of worker safety committees in each factory. The success of the Accord to date is built on the unprecedented collective action of brands and trade unions. Continued solidarity is needed to finish the job and prevent hard-earned gains from disappearing.”