CORPORATE SOCIAL RESPONSIBILITY

Annual Summary of Engagements with Corporations 

2021-2022

INTRODUCTION

It is that time again when the Corporate Social Responsibility Office gets a little “antsy” because we’re still voting proxies, virtually making last-minute decisions on corporate resolutions with “not so happy” corporations, and preparing for corporate annual general meetings (AGM). However, when we reflect on our ministry, we are privileged to be participants in this most important work. We are inspired by Pope Francis, who reminds us:

“A better future can exist only if it is built by everyone for everyone. No one must be excluded!”
108th World Day of Migrants and Refugees, May 5, 2022

Actually, that is our mandate as we witness to living the Gospel and practicing justice and solidarity with the many and diverse organizations and corporations that we work with every day. Our shareholder advocacy work with corporations and people on the margins or at the bottom of the pyramid is very much aligned with the message of Francis. We witness to the daily tragedies around our neighborhoods, cities, nation, and global community. Mass shootings, such as the deadly incidents in Buffalo and Uvalde, have been fueled by purposely hateful speech and facilitated by unfettered access to lethal, military-grade weapons. For two years we’ve all lived through a national and global pandemic/climate crisis, political ill will, and severe human rights abuses. We now add the war in Ukraine, which will continue to impact every aspect of our lives—spiritually, socially, economically, emotionally, and otherwise. The global supply chain has been interrupted; there are millions and millions of migrants and climate/war refugees; the oil/gas industry (one of the most egregious) has been told to drill; and there is little evidence of diplomatic progress.

We are committed to making sure that we haven’t lost the intrinsic value of human rights and the environment. We are working for a just transition in all areas and especially with individual persons who have been affected by a lack of clean water, pure air, and available housing; predatory mortgages; and systemic racial inequities. During our many dialogues with Wells Fargo and with their cooperation (at times), we helped persons secure loan modifications and prevented them from losing their homes or, in several cases, helped them win the case in court. This was still a small number in comparison to the thousands of victims of the bank’s unethical practices.

Principles for Responsible Investing (PRI) has sent a serious executive message to all of us about the JUST TRANSITION which is critical for people and climate action.

  • The just transition is increasingly recognized as a key strategy for delivering ambitious climate action. By responding to the needs of workers, communities, and consumers, governments can accelerate the shift to a net-zero economy: first, by mitigating concerns about downside social risks, and second, by realizing social opportunities in terms of the creation of decent work for all, social inclusion, and the eradication of poverty.
  • The global crisis sparked by Russia’s invasion of Ukraine has added energy security to climate change as a driver for phasing out dependence on fossil fuels and spurring clean energy investment. It has also highlighted the social vulnerabilities of the current energy system (not least in terms of high and volatile fossil fuel prices). Making a just and inclusive transition a reality will be key to the success of national and international policy.       Investor Alliance for Human Rights (ICCR) Initiative

As Sisters of St. Francis of Philadelphia and members of the Interfaith Center on Corporate Responsibility (ICCR) and other coalitions, we have worked diligently to address structural racism, environmental injustices, human rights abuses, and the call to incorporate diversity, equity, and inclusion (DEI). Our most recent resolution with Chevron called for a racial equity audit, which the company refuses to do. We joined with many other organizations to prepare for the Chevron AGM, May 25, 2022. (See https://www.youtube.com/watch?v=oPXVqTOEavI.)

Chevron is only one of the many corporations that we have addressed collaboratively with ICCR staff, partners, our Investor Environmental Health Network (IEHN), Investors for Opioid & Pharmaceutical Accountability (IOPA), CERES, and the several additional coalitions that are members of ICCR. We also collaborate with numerous other social and environmental justice organizations.

Our attached report gives a summary overview of the many actions that addressed the numerous negative impacts caused by corporations. Not all actions made the intended progress, but corporations are keenly aware that they must seek equitable solutions in all areas of their operations. No businesses have been excluded, and the path forward is one of collaboration, communication, and action.

Although our shareholder work is generally focused on companies in our investment portfolio, the issues we address frequently extend to society in general. Many of these issues have broad implications because our work often extends to matters of public policy with our state and federal governments and the SEC. The CSR office has reached out to our federal, state, and local representatives through emails, letters, phone calls, and virtual meetings to urge them toward action benefitting society. Presently Sr. Nora is actively involved in weekly Chester/Delco Environmental Justice planning meetings. The objective is to pursue a variety of actions to close the Covanta incinerator plant. She has attended Delaware County Solid Waste Authority’s virtual public board meeting to make our voice heard! The situation is drastic as landfills are overflowing and the budget is lacking. We are also in dialogue with Chester Water Authority and Aqua/Essential Utilities, which are local actions but have serious implications for Chester city and Chester/Delaware County residents. We have had several meetings with our local representatives on different issues. The Chester water issue is before the State Supreme Court.

One important component of our annual corporate report is highlighting some of the numerous corporate engagements that took place over the past 12 months. The coronavirus, the war in Ukraine, the gun violence, and political ill will heightened the need for engagement across most lines of business and challenged corporations to address the very core of their existence. In our corporate engagements, we are committed to making the moral and business case for corporate responsibility as seen through our mission statement; corporate stands; the environmental, social, and governance (ESG) risks; and the need for accountability.

HUMAN RIGHTS AND THE RIGHTS OF COMMUNITIES

In the spirit of Pope Francis and our Franciscan call to respond to the Spirit, we are working to address some of the many dehumanizing tragedies related to human rights and human dignity, be it racial equity, drug pricing, bonded labor, gun violence, or climate change. The U.N. Guiding Principles on Business and Human Rights calls on companies to respect human rights within their operations and throughout their value chains. ICCR’s Investor Alliance for Human Rights (IAHS) has provided strong guidance to work with companies as we access their current salient risks and evaluate their human rights impacts. We sent reminders to numerous corporations who have scored zero on all human rights due-diligence indicators in the World Benchmarking Alliance’s 2021 Corporate Human Rights Benchmark report. It is important that corporate management and board members provide leadership that addresses significant operational, financial, and reputational risks associated with negative human rights impacts across all businesses. Many companies proudly display their human rights policies while their focus on implementing those policies is often lacking due diligence, assessments, monitoring, and measurements. Often it is pure and plain “greenwashing.”

Watch: Human Rights and Business (a good overview)

 

HUMAN RIGHTS

Amazon, Aqua/Essential Utilities, Aramark, Core Civic (private prison), GEO Group (private prison), Lockheed Martin, Northrop Grumman, Sturm Ruger, Wells Fargo

We continue to engage the above-named companies on the ongoing development or salient risk related to human rights policies. Resolutions were again filed with Amazon, Chevron, Lockheed Martin, Northrop Grumman, Sturm Ruger, Smith & Wesson, and Microsoft. All resolutions were challenged at the SEC, and we’re still working through some of these votes.

AMAZON

Amazon’s technology products and services do benefit society and provide some material benefits. However, the expanding footprint of Amazon’s surveillance and computer vision technology can have disparate impacts on communities of color and immigrants. Amazon hosts the Department of Homeland Security (DHS) Homeland Advanced Recognition Technology (HART) biometric database, which impacts millions of immigrants. We are requesting a third-party report to assess Amazon’s due diligence. While Amazon typically does limited engagement with shareholders, we have urgent concerns and ask to begin a dialogue about the Amazon Web Service (AWS) hosting of the HART biometric database. This mass biometric data collection by DHS is a deep invasion of privacy, is an assault on human rights, and places hundreds of millions of people at risk of raids, detentions, deportations, and family separation. “By hosting DHS’ HART database, AWS is directly facilitating the creation of an invasive biometrics database that will supercharge surveillance and deportation, risking human rights violations” (from our group letter to Amazon).

AQUA/ESSENTIAL UTILITIES

The company established a maximum standard of 13 parts per trillion of PFAS, a group of manufactured chemicals that will break down very slowly and can build up in people, animals, and the environment over time. In an 11/10/2021 dialogue with the CEO, the company insisted that testing is far from accurate. They test surface water monthly for now, but levels can change with every test. Aqua has been attempting a hostile takeover of the Chester Water Authority, which provides public water for many municipalities. This company has a history of buying public utilities and raising rates.

ARAMARK

In a 9/14/21 dialogue, Aramark defended their contracts and performance with correctional facilities. They will continue to contract with prisons despite the many problems they’ve experienced. Aramark works with 450 correctional facilities. They have no input on inmates getting assigned to work. They are not allowed to pay inmates, but individual prisons have their own policies. They are permitted to pay minimum wages to graduates of their IN2Work program who get an internship. They have 113 participants in the IN2Work program. Aramark views this as a positive program, but it seems to be vulnerable to abuse.

NORTHROP GRUMMAN

As primary filers and in collaboration with other ICCR members, we’ve led many dialogues (2013-20) with the company. We did get them to adopt a human rights policy, but the company refuses to disclose its salient risks and complete an impact assessment. Because of the good vote (24%) in 2019, we refiled our resolution on 12/2/20, and the company challenged it at the SEC. We counter-challenged the SEC ruling and our resolution received another good vote (22.35%). Again our 2021 resolution was challenged at the SEC as “ordinary business” and we withdrew since it didn’t have a chance to pass.

LOCKHEED MARTIN

Our dialogues with the company have continued for several years on different topics. We wrote a letter to the company on 10/13/20 on many issues of concern and had a conference call with the company on 11/21/21. The company’s weapons, defense technologies, and surveillance systems are used by governments in times of war and conflict and also contribute to increased militarization of our nation’s borders and surveillance that disproportionately harms immigrants and people of color. Lockheed Martin has a responsibility to assess how its products may contribute to adverse human rights impacts and to take steps to prevent harm.

If Lockheed Martin’s products and services are used by a government customer to commit human rights violations, the company may face serious legal, reputational, and financial risks. The company has come under scrutiny for pursuing contracts that put their business at risk of contributing to human rights abuses. At the AGM, we identified that there is a clear moral responsibility for Lockheed Martin to acknowledge the direct role that the defense industry plays in perpetuating human rights harms in war and conflict and that they must contribute to appropriate remedies. Our vote at the AGM was a disappointing 6.7%.

CORE CIVIC (Private Prison Company)

Our meetings with the chief ethics officer and others from the human rights and ESG division were successful. We commended Core Civic for including the Human Rights R Risk Assessment and making it accessible to the public on its website. At the same time we urged the company to begin to show how they are addressing identified risks using specified metrics, specifically regarding the recommendations for the management of salient human rights issues, which are listed, and for assessing impact and tracking performance.

On 11/18/2021 we had an extensive opportunity to review and make recommendations to Core Civic about their proposed human rights policy. The company has taken more serious steps to integrate human rights and respect for human dignity into their culture, structure, and operations. Core Civic expressed gratitude for the work being done by our small group and asked for a quote from us:

“Our cadre of faith-based investors has been in regular dialogue with Core Civic staff for the last 10 years about the adoption and implementation of a human rights policy. We are pleased with this newly revised policy and the ways that Core Civic has committed to implementing the policy through training, risk assessment, and transparent reporting at all levels of the company. We believe that the processes and instruments Core Civic is developing are breaking new ground in the areas of human rights risk assessment in the corrections field at a time when this is sorely needed—and desired—by investors, contractors, citizens, and especially residents and their families.”

WELLS FARGO

During the year 2021, we had several meetings with both Foley Hoag, a third-party assessor, and Wells Fargo on the Human Rights Impact Assessment (HRIA). A number of rightsholders were interviewed by Foley Hoag. In December 2021, Wells Fargo stopped Foley Hoag from communicating with us. They took the Foley Hoag HRIA and in March released their version of the report, claiming that it was the HRIA. They still refuse to believe that it is only the groundwork to start doing the assessment of their salient and predatory issues.

RACIAL EQUITY AUDIT

Altria Group, Chevron, Johnson & Johnson, Microsoft, Tyson Foods, Yum! Brands

ALTRIA GROUP

The Sisters of St. Francis filed a resolution requesting a third-party civil rights equity audit to assess the impact of the company’s policies, practices, products, and services on Black, Indigenous, people of color (BIPOC), and Latinx/a/o/e communities, as well as the impacts on youth. A dialogue followed on 1/4/2022 in which the company detailed the many initiatives they feel support racial equity. We contended that some of their charity could be used to silence recipients, such as Al Sharpton and Vernon Jordan. Shareholders voted on the proposal at the Altria annual meeting and it received 62.5% support. We will follow up with the company to press for the audit.

CHEVRON (Environmental Justice /Racial Equity Audit)

For over 10 years now, the Sisters of St. Francis have been lead filer on resolutions focused on human rights and the company’s human rights policy. We have continuously challenged the company to make the policy operational. It has been evident that the company struggles to effectively address the many salient issues related to its operations in the development, storage, and transportation of oil and gas. We have no data to substantiate that Chevron is using the core international human rights framework to assess, identify, prevent, mitigate, and remedy adverse human rights impacts.

Chevron is one of the highest greenhouse gas emitting companies in the world. Its emissions contribute to the climate crisis, which disparately impacts people of color and furthers systemic racism. Chevron’s operations, discharges, and leaks disproportionately burden communities of color with pollution and human health risks (Scientific American). We had dialogues with the company on 12/15/2021 and 1/13/2022 on the proposal to do a racial equity audit. We appreciated the fact that Chevron made a $15 million racial equity commitment that focuses on education, job creation, etc., but this does not meet the expectation of a racial equity audit that includes impacts on people’s land rights, quality health and human rights, violence against indigenous women, and widespread environmental inequities. A racial equity audit is a critical tool for Chevron to address the risks and opportunities posed by civil rights, equity, diversity, and inclusion related issues. The resolution was presented at the AGM on May 26, 2022. We have collaborated with several groups and participated on 5/11/2022 in a panel with the Union of Concerned Science and other organizations. We received an excellent vote of 48% at the annual meeting.

JOHNSON & JOHNSON

The Sisters of St. Francis cofiled a racial equity audit supporting the primary filer, Mercy Investment Services. This proposal requests that JNJ produce a third-party audit which assesses and produces recommendations for improving the racial impacts of its policies, practices, and products. After winning the SEC challenge, the proposal was presented at the AGM on 4/28/22 and received 62.65% of the vote.

MICROSOFT

Our initial dialogue with the company took place on 9/21/2021. Microsoft sells surveillance technologies and high-risk products and has contracts with customers which are responsible for adverse human rights impacts, including furthering racial injustice and discrimination. This suggests that Microsoft fails to implement its own human rights commitments, exposing the company to legal, financial, and reputational risks. We had two other dialogues, on 3/14/2021 and 4/4/2022, with the good prospects that Foley Hoag would conduct a third-party Human Rights Impact Assessment. Microsoft has indicated that it may not include the military contracts. We have written a letter to prevent this from happening. At our dialogue on 5/20/2022, Microsoft committed to doing a regular racial equity audit—military contracts not included at this time.

TYSON FOODS

American Baptist Home Mission Society filed this resolution, which we cofiled, asking the company to commission an independent racial equity audit analyzing if, and how, Tyson’s policies and practices discriminate against or disparately impact communities of color. On 2/25/2022, the company agreed to have an independent organization conduct the racial equity audit. Tyson will publish its findings within a year. Due to this agreement, shareholders decided to withdraw the proposal.

YUM! BRANDS

This topic was added to the agenda of our 12/9/2021 dialogue to follow up on a letter ICCR shareholders sent to the company. Yum addressed a few of our concerns. Inclusion and race are now treated as foundational pieces; they’ve described it as a journey on diversity and inclusivity. Their programs started three years ago, a paradigm for parity. Inequality on leadership is being addressed. They have hired a chief diversity officer. A follow-up dialogue will be scheduled for early fall 2022.

 

CLIMATE CHANGE/WORKING FOR CLIMATE SOLUTIONS

Chevron, Conoco Philips, Southern Company, Amazon, all banks, and many other companies

In Laudato Si’, Pope Francis calls us to love our “Mother Earth.” The urgency and scale of the climate crisis are looming as never before as we continue to urge companies to reduce their carbon footprint and methane emissions and to report disclosures according to the Task Force on Climate Related Financial Disclosures (TCFD) and the Carbon Disclosure Project (CDP).

 

SOUTHERN COMPANY

We participated in a project as part of Southern Company’s efforts to identify and evaluate the company’s environmental, social, and governance (ESG) priorities or sustainability priorities. This project will guide efforts to enhance disclosure and engagement to build long-term strategies. On 2/1/2022 we received communication from the company that, by the end of 2028, Southern Company subsidiaries will have reduced the number of retail coal units by 85% and retail coal capacity by 75%. Georgia Power (a subsidiary) will double the amount of solar power by 2035. The company continues to work to achieve their decarbonization goals over the next five years and has shown strong leadership in this area over the past five years.

METHANE

We participate in monthly ICCR calls on methane emissions related to company policies and practices. We actually have been educated by the Environmental Defense Fund (EDF), and they remind us that the “clock is ticking on climate action in the oil and gas industry. Reaching net zero by 2050 involves not only curtailing fossil fuel use but also limiting emissions from fossil fuel production as economics TRANSITION to a clean energy future.” The very sad news is that oil and gas mergers and acquisitions do not cut global greenhouse gas emissions.

 

CONTRACT SUPPLIERS/VENDOR STANDARDS/ETHICAL RECRUITMENT/TRAFFICKING/IMMIGRATION

GEO, Core Civic, Amazon, Hershey, Walmart, Cotton Industry, Yum! Brands

During this shareholder advocacy season, we have pressed numerous companies on immigration, worker rights, trafficking, ethical recruitment, and bonded labor; all are very much still evident across the globe. For this proxy season, we filed or cofiled four resolutions referencing immigration, biometric data (Northrop Grumman), and due diligence (Amazon). Immigrants and migrant workers are often exploited. Exploitation includes discrimination, retaliation, debt bondage, and confiscation of wages through illegal reductions. Many times immigrants and migrant workers are restricted in accessing personal documents and are limited in freedom of movement, which often leads to forced labor and trafficking. All of the above companies are encouraged to have strict guidelines in place for the ethical recruitment of workers.

HERSHEY

We spoke to three Hershey executives in sustainability roles about the company’s initial responsible recruitment efforts. Gina Falada, of Investor Advocates for Social Justice (IASJ), was persistent in leading the resolution and dialogues. While the company recently adopted a Responsible Recruitment Policy, it only applies to Hershey’s direct labor contractors, as opposed to its suppliers’ labor recruiting practices. This fact makes the policy limited in scope. We’ve been communicating with the company for some 20 years on child labor in cocoa production, especially in West Africa. We’ve seen the company make commitments, but child labor still exists. It was once again necessary to cofile a resolution on child labor. We see this as a critical way to address systemic poverty as a root cause of child labor. Our dialogues addressed numerous issues around the complexities of pricing, cocoa market structure, cocoa farmers, living wage, supplier audits, procurement, and risks. Shareholders won the No Action at the SEC. The final vote at the Hershey AGM was 7.65%. But, sad to say, CEO Michele Buck spoke to the resolution, including a comment that it was not achievable for Hershey to end child labor in its supply chain by 2025.

THE COTTON INDUSTRY

Since August 2020 and throughout the year, we have been actively involved with letter writing to many companies about forced labor in the supply chain, especially connected with the Coalition to End Forced Labor in the Uyghur Region of China. The government of China continues to press ahead with its systematic program to eliminate the Uyghur community’s identity and way of life through forced and prison labor, family separation, and forced sterilization, among other serious human rights violations. Cotton is one of the many products of the region, and this forced labor is an urgent cause for all companies to bring about change for the Uyghur peoples. Several nations have filed genocide resolutions on the Chinese government. On 2/21/2022 we had a valuable session on implementing due diligence within cotton’s complex supply chain. On 4/13/2022 we had an extensive meeting with the Yarn Ethically Sustainable and Sourced (YESS) program on new action plans for the next season.

 

CHEMICAL FOOTPRINT PROJECT, PRODUCT SAFETY, PLASTICS

Hasbro, Dollar Tree, Dollar General, Lowe’s, Walmart, Target

Our main initiative right now is to ask companies to check all aspects of product safety, from plastics to chemicals, with a focus on the Chemical Footprint Project (CFP).

You might be a little shocked when you visit the Mind the Store campaign’s website, but I think a trip is worth it. You’ll see the Retailer Report Card and note the scores of companies that need to improve product safety.

HASBRO

Our next dialogue with the company is scheduled for June 2022. We are pleased that they participated in the CFP for the first time and we await the report. The CFP survey provides companies a robust standard with which to track major components of their chemicals management system including the company’s management strategy, its knowledge of the chemicals in its products and supply chains, its efforts to reduce chemical hazards and encourage use of safer alternatives, and its actions to publicly disclose information on chemical ingredients in its products. Hasbro has committed to reporting.

DOLLAR GENERAL

On 12/1/2022 we cofiled our resolution asking Dollar General to reduce its chemical footprint by adopting new policies including expanding its chemical restrictions to include appropriate categories of third-party-branded products and accelerating the timetable to expand the number of chemicals addressed in their restricted list. The resolution was withdrawn when the company agreed to reduce its chemical footprint by expanding to a Restricted Substance List (RSL) and participating in the Chemical Footprint Project. The company will only dialogue with two people from the Presbyterian Church, which is a sign of poor management and failure to be transparent. Their recent meeting became a huge news story. We gave our proxy to Reverend William Barber, of the Poor Peoples Campaign. He had the legal documents to enter in our name. Dollar General and two other persons with proxies were prevented from entering. We are now asking for a meeting with the CEO and board chair.

https://www.nashvillescene.com/news/pithinthewind/dollar-general-denies-entry-to-legal-proxies-at-annual-shareholder-meeting/article_5f28659a-dc53-11ec-952c-3f742cab26c4.html.

https://twitter.com/brotherjones_/status/1529492694753583105?s=20&t=UUrRhXeGnTdV6P7V3Uwd9g.

 

GUN SAFETY and FINANCING NUCLEAR WEAPONS

“‘Why the Kids?’ In Close-Knit Uvalde, It’s Everyone’s Loss.” (New York Times, 25 May 2022)

In Uvalde, Texas, where 19 children and two teachers were killed, everyone, it seemed, had a connection to those lost.

Master Card, Sturm Ruger, J. P. Morgan Chase, Smith & Wesson, Bank of America, Wells Fargo, Northern Trust

STURM RUGER

Our resolution urged the Sturm Ruger (RGR) board of directors to oversee a third-party Human Rights Impact Assessment that assesses and produces recommendations for improving the human rights impacts of its policies, practices, and products, above and beyond legal and regulatory matters. Input from stakeholders, including human rights organizations, employees, and customers, should be considered in determining the specific matters to be assessed. In the words of Laura Krausa, of Common Spirit Health, the primary filer: “While by no means a solution to the complex issue of gun violence, an independent assessment of the human rights risks RGR needs to confront given its gun business is a solid first step toward identifying and addressing potential gun-related harms.” The assessment is meant to help the company put risk management and accountability structures in place to prevent these harms from occurring, and in the case of a firearms manufacturer, this is literally a matter of life and death for all of us, especially for our children, for whom gun violence is now the leading cause of death in our country. CHEERS: We received a majority vote because of the super pressure by Laura Krausa for Common Spirit Health.

SMITH & WESSON

In our dialogue on 4/10/2022 and in our resolution, we requested that the Board of Directors of Smith & Wesson Brands, Inc., adopt a comprehensive policy articulating its commitment to respect human rights, which includes a description of proposed due-diligence processes to identify, assess, prevent, and mitigate actual and potential adverse human rights impacts. We explained that the U.N. Guiding Principles on Business and Human Rights were built on the dignity of the human person and the state duty to protect human rights, the corporate responsibility to respect human rights, and the process to remedy adverse human rights impacts. The new corporate secretary was paying attention and asked questions that were meaningful. This had not happened in the past.

 

HEALTH EQUITY

AmerisourceBergen, Bristol-Myers Squibb, Johnson & Johnson, Merck, Pfizer

AMERISOURCE BERGEN

On 10/22/21, ICCR and IOPA shareholders met with AmerisourceBergen (ABC) representatives to get an update on diversion efforts regarding opioids. In a call to update shareholders on how successful they are with diversion control, ABC board member Kathi Hyle touted their board-level compliance and risk committee and the attention they pay to oversight, but many policies were in place before suspicious orders were made. They believe they were early adaptors of Covid-19-related safety measures. They send reports to DEA daily.

JOHNSON & JOHNSON

Achmea Investments coordinated a sign-on letter asking pharmaceutical companies to A) prioritize and fulfill COVAX and African Vaccine Acquisition Trust (AVAT) contracts as a matter of urgency; B) provide full transparency on the overall monthly production of Covid-19 vaccines and clear monthly schedules for supplies of COVAX, AVAT, and low and low-middle income countries; C) actively engage and work with countries that have high coverage to allow for the prioritization of COVAX and AVAT contracts; and D) commit to share know-how more rapidly, facilitate technology transfer, and provide transparent nonexclusive voluntary licenses. A 3/22/2022 dialogue produced nothing substantial, as Johnson & Johnson laments lack of infrastructure in developing countries for addressing most problems.

 

TOBACCO

Altria Group, Disney, Comcast Corporation, Kroger, Philip Morris International, Rite Aid, Streaming Companies, Walgreens

Our tobacco work encompasses the companies that manufacture the products, the retail pharmacies that sell tobacco products, and media companies that allow tobacco depictions in their entertainment content accessible to children. The reason for engaging with media companies is a surgeon general’s report that determined a causal relationship between movie and television tobacco depictions and the initiation of smoking by youth.

PHILIP MORRIS INTERNATIONAL

The Sisters of St. Francis of Philadelphia cofiled a resolution asking the company to initiate steps to phase out all production of PMI’s health-hazardous and addictive products by 2025. In September 2021, PMI acquired Vectura Group, a U.K.-based manufacturer of respiratory therapy devices such as inhalers and nebulizers that help people with asthma and lung diseases to breathe. Although PMI publicly stated that it intends to stop selling cigarettes in the U.K. within 10 years, the CEO said they would keep its Marlboro business to help finance its growth in “wellness” products. This proposal was voted on by the shareholders at the 5/4/22 AGM. The proposal received only 1.5% of the vote.

STREAMING COMPANIES

After years of engagement with the five MPAA movie studios on tobacco depictions, policies have mostly been established limiting the depictions of tobacco use in youth-rated movies, with exceptions for historical or literary figures. There are now numerous streaming services provided by companies such as Amazon, Netflix, Hulu, Apple, and many more including some private companies. As this is still a new medium, the adoption of tobacco policies has been slow.

WALGREENS

The Sisters of St. Francis of Philadelphia filed a proposal that requests a report on the external public health costs created by the sale of tobacco products by Walgreens and the manner in which such costs affect the vast majority of its shareholders who rely on overall market returns. This proposal received 11.4% of the vote. Subsequent attempts to request a dialogue with Roz Brewer, the new CEO, to discuss tobacco have gone unanswered. News reports from 3/31/22 quote the CEO as saying that tobacco sales are under “real scrutiny.” However, they’ve said similar things before, without action.

 

FOOD JUSTICE, FAIR WAGES, AND PAID SICK LEAVE

Aramark, Darden Restaurants, Dine Brands, FedEx Corporation, Hormel Foods, Kroger, McDonald’s, Restaurant Brands International, Tyson Foods

The food system in this country is broken. Urban food deserts, massive waste, antibiotics in meat, exploitative labor practices, and generally unsustainable methods have been the hallmarks of the food industry.

DARDEN RESTAURANTS

The Sisters of St. Francis were the lead signatory in a 1/17/22 letter to Darden asking the company to respond to the following questions: A) total size of their workforce, breaking down the number of full-time, part-time, contract, and franchise workers, as well as demographic information; B) description of its paid sick time policy by worker classification; C) breakdown of the paid sick time benefits related to the pandemic, and whether these benefits are permanent or temporary. Darden responded on 2/16/22 by including specific information, including a one-time bonus for team members, workers earning one hour of PSL for every 30 hours worked, PTO to receive the vaccine, and emergency pay for workers laid off when their restaurants were closed.

HORMEL FOODS

Dialogues were held on 10/27/21, 1/18/22, 3/16/22, and 4/22/22 to negotiate enhancements to Hormel’s antibiotics policies. We have held the company to its promise to eliminate the routine use of medically important antibiotics in their company-owned turkey and pork farms and contract turkey farms. We’ve made progress on defining routine use of medically important antibiotics (mostly), but we’re concerned that Hormel’s language continues to be nonspecific in terms of timelines or achievements. Hormel produced guidelines that address some of our concerns. Dialogues will continue.

RESTAURANT BRANDS INTERNATIONAL

The Sisters of St. Francis of Philadelphia cofiled this resolution with a Canadian organization, Shareholder Association for Research and Education (SHARE), requesting the company explain how their strategy, programs, and incentives enable franchisees to adopt competitive employment standards, including wages and benefits. Franchisors’ inability to establish competitive working conditions and successfully attract and retain an operational workforce may threaten their ability to achieve their productivity goals and financial objectives and negatively impact shareholders’ long-term value. The AGM is 6/15/22.

 

LOBBYING

Altria Group, Comcast Corporation, United Parcel Service

ALTRIA GROUP

Trinity Health filed this resolution asking for an annual report on Altria’s grassroots lobbying communications, payments by Altria, and membership in and payments to any tax-exempt organization that writes and endorses model legislation. The dialogue on 3/1/22 was productive. Altria is going to be publishing a separate report on political activity and lobbying. They will do this report annually. They are expanding disclosure—but the big sticking point remains that they will not disclose the portions of payments to trade associations and social welfare organizations that are used for lobbying activities. Filers decided to withdraw as a result of concessions.

COMCAST CORPORATION

A Lobbying Disclosures proposal was filed by Friends Fiduciary during the 2021 shareholder season and was withdrawn as a result of the company agreeing to enhance its disclosure of lobbying expenditures on the company’s corporate website. However, the enhanced information has not been sufficient and FFC decided more dialogues were necessary. On 11/11/21, our group met with corporate reps; they explained that they were still working on improving the report and that they would include all direct and indirect lobbying and grassroots lobbying communications and membership in and payments to any tax-exempt organization that writes and endorses model legislation.

PUBLIC POLICY

Generally, issues of public policy have an impact on our shareholder advocacy work and vice versa. We have met with state representatives on the environmental impacts of natural gas pipelines, methane, and the Chester incinerator environmental-justice issue. We have cosigned letters to the USDA on worker safety in meat processing plants and to the FDA on nutrition innovation policy. We have joined public campaigns to pressure our representatives to initiate greater oversight of the distribution of opioid medications. The CSR office has reached out to our federal and state representatives through emails, letters, phone calls, and in-person meetings, to urge them toward action benefitting society.

CONCLUSION

For a video overview of the work of the Office of Corporate Social Responsibility, click here.

For more of a summary of our actions, click here.

As we conclude our summary of our actions for 2021-22, another round has begun. Several meetings are already scheduled throughout June and July 2022. Thank you for reading and participating in our ministry.

Thomas McCaney
Sr. Nora M. Nash, OSF