c. 1997 Religion News Service
SEATTLE _ More than 1,000 shareholders of the Boeing Company came together here April 28 for the annual ritual of assessing the aerospace giant’s past performance and anticipating the year to come.
And in a footnote to the proceedings, shareholders overwhelmingly defeated two resolutions by religious investors urging Boeing to build human rights considerations into its lucrative trade with China and impose an ethics code on its sale of military equipment.
Two days later, shareholders of the Wendy’s restaurant chain gathered in Columbus, Ohio, for their annual meeting. Far down on the agenda was a resolution introduced by a group of religious investors from Minneapolis, St. Louis and Detroit, calling for smoke-free restaurants throughout the chain. The measure went down to defeat.
That vote came on the heels of the annual meeting of the Philip Morris Company April 24 in Richmond, Va. There, shareholders’ eyes collectively glazed over when an order of Catholic nuns from Houston and a half-dozen other religious investors tried to convince the company to remove benzo(a)pyrene, the major cancer-causing tobacco byproduct, from its cigarettes. Both proposals were voted down.
Welcome to shareholder season, the six-week period from mid-April to mid-May in which institutional and individual investors in major American corporations gather to rub shoulders with corporate executives and scrutinize the bottom line.
And while this time-honored tradition of American capitalism primarily draws investors tightly focused on profits and losses, a small but growing cadre of religious activists have managed to carve out a niche for themselves in the ritual, challenging what they regard as corporate greed, prodding shareholder consciences and urging economic and social justice.
Much of it is the doing of the Interfaith Center on Corporate Responsibility (ICCR), a coalition of more than 100 Catholic, Protestant and Jewish institutional investors, established 25 years ago. Comprised of denominations, agencies, religious communities, pension funds, healthcare corporations and dioceses, the investor-activists have combined portfolios worth an estimated $70 billion.
Collectively, the religious investors have brought forth 50 resolutions this shareholder season, challenging U.S. companies to be more socially and environmentally responsible, questioning excessive executive pay and pushing for racial equity in the workplace.”More and more companies are coming to share our view that good corporate citizenship is good business,”said Timothy Smith, executive director of ICCR.”Today most companies at least try to work with religious shareholders to improve their corporate social and environmental performance. This is a major change of attitude from what we experienced from corporate officials 25 years ago when the corporate social responsibility movement began.” Much of the time, as occurred this week, the idealistic resolutions are voted down. But the shareholder resolutions also serve as a bargaining chip: Nearly one-third of the 194 resolutions brought forward by religious investors in the past year were withdrawn after companies agreed to enter into talks on issues from the environment to working conditions in sweatshops.
Among them was a measure challenging Pepsico on its trade with the repressive military regime governing Myanmar, formerly Burma. The resolution was withdrawn after the company announced plans to end its investment there.
One of the religious investors’ earliest success stories was their campaign in the 1970s and `80s to persuade corporations to divest their assets in South Africa under the apartheid system _ a project that took years of effort before economic isolation helped bring down the African nation’s system of racial separation in 1990.
In the early `90s, they helped convince Eastman Kodak to get out of the tobacco business by spinning off a subsidiary that manufactured filters for cigarettes. Kimberly Clark was persuaded to end its tobacco-related businesses and Knight-Ridder, Inc., decided to drop tobacco advertising from its publications. And the 3M Corporation last year agreed not to accept any new tobacco contracts for its billboard business and allowed existing tobacco contracts to expire by 1998.
Most recently, religious activists were crucial in the development of the White House Accord to Address Sweatshop Abuses, expected to be approved by President Clinton in October.
Such victories are what sustain corporate responsibility activists like the Rev. Michael Crosby, who has criss-crossed the country this shareholder season, challenging the aerospace, fast-food and tobacco industries. Carrying a portfolio of modest investments that guarantee religious groups a place at the shareholder table, Crosby acknowledges that being the corporate gadfly evokes amusement or hostility from shareholders and is generally ignored by the news media.”We’re regarded as a footnote to the proceedings, if we’re lucky,”said Crosby, a Capuchin friar from Milwaukee whose order owns 100 symbolic shares of Boeing stock. As a board member of the New York-based Interfaith Center on Corporate Responsibility, Crosby has represented the interests of a variety of religious investors for the past 25 years.
Spurred by the plight of Tibetan Buddhists who have been persecuted under Chinese rule and troubled by the Clinton administration’s pursuit of trade with China despite widespread evidence of human rights abuses, Crosby lobbied Boeing’s management for months before introducing his human rights resolution at the shareholders’ meeting. A group of Methodist, Episcopal and Catholic investors brought forward the second resolution on military contracts. The Boeing board of directors recommended defeat of both measures.”I expect that our resolution will not get a majority vote here today because our obsession with profits will make us blind to the oppression of our brothers and sisters in China,”Crosby told Boeing management and shareholders Monday (April 28).”Yet, although we may not be successful, we must be faithful. I ask you to balance your desire for dividends with your basic instinct to do the right thing. Just ask yourselves: If I were a worker in China making products for Boeing, would I not want someone who had the chance to speak in my behalf? This is a simple matter of loving your neighbor as yourself, of linking the rights of disenfranchised people with your need for profits.” (OPTIONAL TRIM – STORY MAY END HERE)
But even though his resolution was voted down, Crosby considers the Boeing encounter a success. Often, resolutions from religious activists are met with boos or stunned silence. At Boeing, however, there was a lively, 30-minute floor debate. And when the final vote was tallied, 87 percent of shareholders rejected the measure; 4 percent supported it and 9 percent abstained. Under rules established by the Securities and Exchange Commission, a yes vote of 3 percent or higher means the resolution can be introduced again. And the 9 percent undecided voters, many of whom represent institutional investors, will be lobbied.
Crosby said the Boeing encounter was easy compared to the resistance religious investors encountered from Wendy’s and Philip Morris.
The fast-food chain, represented in TV ads by Dave Thomas, the smiling and affable founder of Wendy’s, was”a real difficult engagement … one of the most recalcitrant companies we’ve encountered,”Crosby said.
He noted that Wendy’s management was so opposed to the smoke-free restaurant resolution proposed by the Capuchin Friars, Mercy Health Services of Detroit and Sisters of Mercy of St. Louis, that the ICCR had to sue the company to get the measure placed on a proxy ballot.
Even though the resolution was approved by 11 percent of the shareholders, in exchange for a place on the ballot, the religious investors had to agree not to come back with any other resolution for the next three years.
In many ways, the Philip Morris meeting was the most daunting of Crosby’s shareholder season encounters.
The proposal to remove carcinogens from cigarettes and limit advertising, sponsored by the Sisters of Charity of the Incarnate Word of Houston and other religious groups, was met, Crosby said, by hollow stares and incomprehending silence before it was overwhelmingly voted down.”It’s a multitude of sins we’re dealing with,”he noted.”It’s not only greed, but the denial of the shareholders about the effect of their product.”When you think of it, most of the shareholders at Philip Morris come from people who are members of the Judeo-Christian tradition,”he said.”When you raise moral questions to a company that is making an addictive product, you realize the reason they don’t comprehend what you’re saying is that their deeper addiction is to profits. Their fix is the dividend. And they just don’t get what we’re trying to do.” MJP END CONNELL
