Section:
csr
Annual Summary of Shareholder Engagement
2009-2010
The following action summaries and the chart of activities will give an insight into our shareholder engagement for 2009-2010.
HUMAN RIGHTS
DuPont: We are still addressing the issue of genetically modified organisms. This year we asked DuPont to amend its human rights policy to include respect for and adherence to seed-saving rights of traditional agricultural communities. We received a 6.09% vote, which means we can refile next year. Our subsequent dialogue on April 28 addressed local issues.
Chevron: As cofilers of a resolution with the Wisconsin Jesuit Province and 42 other shareholders, we have asked this transnational corporation operating in countries with repressive governments, ethnic conflict, and poor labor and environmental standards to become more transparent and to adopt a comprehensive, verifiable human rights policy. Last year we had a vote of 29.10% and expected a higher vote this year. We filed the resolution in December 2009. After much dialogue and meetings in January and February, the resolution was withdrawn. Chevron will begin to adopt a comprehensive human rights policy over the next couple of years.
PENNSYLVANIA SPECIAL ISSUE
Hydraulic Fracturing: The Marcellus Shale, an organic rich shale that is part of the subsurface beneath much of Ohio, Pennsylvania, West Virginia, and New York is one of the largest unconventional natural gas reserves in the world. Hydraulic fracturing (frac’cing) involves the injection of more than a million gallons of water, sand, and chemicals at high pressure down and across a horizontally drilled well as far as 9,000 feet below the surface, causing the rock layer to crack. These fissures enable the gas to flow up into the well. We are addressing numerous serious issues with this process: the use of toxic chemicals; water, run-off; underground water contamination; management of wastewater and chemical disposal; impact on all creatures and the natural environment; and damage to forests, roads, and property.
We have met with Gov. Rendell’s chief administrative officer and several representatives and written letters to congresspersons, which many of you have cosigned. The good news is that the state House of Representatives has voted for a three-year moratorium on new leases and now we’re urging the senate to do likewise. As shareholders we’ve written to Marathon Oil and ExxonMobil and filed resolutions with Chesapeake Energy and Conoco Phillips. Annual company meetings will determine the vote.
MILITARISM AND VIOLENCE
Boeing, Caterpillar, Lockheed Martin, Northrop Grumman: Each year we file resolutions with these companies related to ethical criteria for military production, weaponization of space, offsets, and foreign military sales. This year’s U.S. budget for weapons systems is $210 billion. Note that U.S. global arms sales last year reached $38.1 billion, not including arms transfer deliveries to developing nations totaling $23.8 billion. Several times in recent history, we’ve seen weapons sold to one country result in a threat to our own security. We’ve asked for a comprehensive report on the company’s foreign sales of weapons-related products and services. The only company willing to dialogue is Lockheed Martin.
VIOLENCE IN MEDIA
Blockbuster, Best Buy, Game Stop, Microsoft, Target, Toys ’R Us, Sears and Wal-Mart: With all of these retail companies we’ve had successful dialogues around many aspects of sales and promotion of violent video games, enabling them to be more responsible in establishing policies both for in-store and internet use that will prevent youth from purchasing M-rated games.
CLIMATE CHANGE
Chevron: A resolution was not filed this year on emission reduction. Instead, a dialogue was held with the company on March 16, 2010. Chevron has implemented an industry-leading program to track GHG emissions from products, as well as operation. This specific information will help them identify areas that need to be improved.
Exxon Mobil: We cofiled a resolution asking for a report on the long-term risks to the company’s finances and operations of extracting oil from the Canadian oil sands. The company has held a preliminary dialogue with us. In addition, we have met with the company on our request that they adopt goals for reducing greenhouse gases from both products and operations.
ENVIRONMENTAL HEALTH
Smithfield Foods, Tyson Foods: A multi-pronged approach, including coalition-building and public campaigning, is used to build the case that civil society and the public at large wants Smithfield and Tyson to make changes in our two priority areas of great concern to public and worker health: antibiotics use and water pollution. Smithfield has dialogued with ICCR in the past, although with little satisfaction. Tyson refuses to engage us.
ENVIRONMENTAL JUSTICE
Coca Cola: Coke continues to dialogue, providing details of water catchment, recycling, and use reduction initiatives in India. Meanwhile, provincial governments there have accused the company of releasing toxic pollution into the water supply and depleting aquifers. An April 2010 letter from ICCR members asks the company for specific answers to the allegations.
Massey Energy: We cofiled a resolution requesting the company to report on the progress of the remediation of streams ordered by the EPA as a result of their mountaintop removal mining process. In light of the death of 29 miners at Massey's Upper Big Branch facility, our statements at the annual meeting will focus on their lack of safety and adherence to EPA standards.
CONTRACT SUPPLIERS/VENDOR STANDARDS
Macy's, McDonald's, Proctor & Gamble, Toyota, Wal-Mart, etc.: 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. This issue continues to be a very serious one for all companies who outsource to factories in developing nations.
ACCESS TO CAPITAL
Bank of America, Citigroup, Goldman Sachs, J.P. Morgan Chase, and Wells Fargo: This year resolutions and dialogues with these financial companies deal with predatory credit card lending practices, credit crisis, and over-the-counter derivatives. All of these companies have been open to dialogue and progress is being made with added pressure from congress, the White House, and consumers at large. We were primary filers with Citigroup, and Wells Fargo on the credit card issue and ongoing dialogues have been successful. The resolutions on derivates received excellent votes and will lead to further dialogues. (Bank of America 39%, Citigroup 30%, Goldman Sachs 33.8%)
ACCESS TO HEALTH CARE
Abbott Laboratories, Bristol-Myers Squibb, Johnson & Johnson, Kroger, Macy's, McDonald’s, Pfizer, Verizon Communications, Wal-Mart: Resolutions were not filed this year, as national reform was pending. Dialogues continued with many companies to determine the next steps needed and the challenges faced by employers.
Abbott Laboratories, Bristol-Myers Squibb, Johnson & Johnson, Merck, Pfizer: UNITAID's patent pool model for low and middle income countries would produce lower prices and greater access for 2nd and 3rd line HIV therapies. Discussions with companies centered on the companies' willingness to join the pool. This is an ongoing process and UNITAID believes that they should have some commitments by 2011.
TOBACCO
Altria Group, Reynolds American:, Philip Morris: We are primary filer with Altria on "Food Insecurity and Tobacco Use." This resolution asks these companies to report on the effect of their marketing strategies on the purchasing practices of poor people who smoke. Our resolution also asks the companies to evaluate what might be done to mitigate the harm to innocent children in these families. We also cofiled this resolution with Philip Morris and Reynolds American.
CORPORATE GOVERNANCE
Cisco Systems: This resolution addressed the issue of excessive executive compensation and of holding the CEO accountable for the issue of pay. The vote at Cisco “Say on Pay” received 51% vote last year and it appears that the company will begin to address the issue.
Goldman Sachs: The issue of "Pay Disparity" is not one that this company is willing to address since their program is designed to attract, retain, and motivate particular talent. Their executive compensation packages are outrageously high and they are not willing to do an analysis related to "excessive."
Additional Summaries of Shareholder Engagement
(Word.doc 86kb)
