wfn.org | AIDS drugs added to list of investment concerns

[PCUSA NEWS <PCUSA.NEWS@ecunet.org>]

Note #7359 from PCUSA NEWS to PRESBYNEWS:

30-July-2002
02272

AIDS drugs added to list of investment concerns

MRTI will also focus on environment, firms' employment practices

by Jerry L. Van Marter

SEATTLE - The Presbyterian Church (USA)'s investor watchdog panel has chosen environmental issues, community involvement and corporate accountability as its priorities for the coming year.

During its meeting here July 25-27, the Mission Responsibility Through Investment (MRTI) committee adopted only a few changes in the way it views companies in which PC(USA) entities own stock.

It added one point of emphasis to its "work plan" for 2002-2003 - the availability and affordability of AIDS drugs in Third World countries - as recommended by MRTI representatives from the Board of Pensions (BOP).

It will continue to closely monitor firms' employment practices, media standards, militarism and effects on family farming.

MRTI, which will celebrate 30th anniversary this fall, urges companies whose stock is owned by PC(USA) entities - chiefly the BOP and the Presbyterian Church (USA) Foundation - to conduct their business in keeping with the social policies supported by the General Assembly (GA). It also advises church-related investors on the corporate conduct of such companies.

The BOP's portfolio is worth more than $5.5 billion. The Foundation's investments amount to about $1.5 billion.

The committee includes representatives of the BOP and Foundation, as well as the Advisory Committee on Social Witness Policy and the PC(USA)'s advocacy committees for women's concerns and racial-ethnic concerns. Most of its work is done ecumenically, primarily through the New York-based Interfaith Center on Corporate Responsibility (ICCR).

MRTI utilizes three strategies with companies:

* Formal dialogue with corporate officers;

* The filing of shareholder resolutions at corporation meetings; and,

* Divestment of PC(USA) stock holdings.

Divestment requires GA concurrence.

Some specifics of the MRTI's 2002-2003 plan:

Environment

MRTI started examining companies' environmental records in the early 1990s after the GA adopted a comprehensive policy on the environment. The thrust of its strategy is focusing on key issues (air, soil and water pollution and global climate change) and targeting industry groups whose actions affect those issues (e.g., those that produce petrochemical, paper and forest products, electronics and semi-conductors and utilities).

ICCR and MRTI have mainly engaged companies on a set of 10 principles established by the Coalition for Environmentally Responsible Economies (CERES) to evaluate firms' environmental stewardship.

MRTI's current focus list includes Advanced Micro Devices, Atlantic Richfield (ARCO), Chevron, CSX, DuPont, ExxonMobil, Hewlett-Packard, Intel, Phillips Petroleum, Union Pacific and Unocal.

CERES plans to approach several other companies in the coming year: FedEx, Staples, Gillette, Cisco Systems, Oracle, Pepsico, Dell, Verizon and Alcan. PC(USA) entities own stock in all of them except Staples.

Community reinvestment 

The religious community recently has been urging financial-service companies to do more to revitalizing distressed urban and rural communities. 

This effort has focused on firms' compliance with two federal laws - the Community Reinvestment Act, which requires banks to meet the credit needs of their entire communities, including small businesses and low- and moderate-income families, and the Equal Credit Opportunity Act, which prohibits discrimination in lending on the basis of race, color, religion, national origin, sex, marital status or age. The 1995 GA endorsed both laws.

Companies on MRTI's focus list include Citigroup, Wells Fargo, J.P. Morgan Chase, Household International, Golden West, Bank of America, ABN AMRO (a Dutch bank involved in mortgage lending in the United States), National City Bank and Union Planters Bank.

Corporate accountability

In its early years, MRTI was a leader in opposing companies whose practices helped sustain apartheid in South Africa. More recently it has kept an eye on companies operating along the U.S. border with Mexico.

The issues the committee has addressed include global manufacturing standards, the corporate behavior of vendors under contract to companies, child labor and forced labor, and basic human rights, including the right to a living wage and to equal employment opportunity.

Firms on MRTI's watch list include Hasbro, Sears, Mattel, Disney, Delphi, Target, Wal-Mart, Nike, General Motors and Talisman Energy, a Canadian oil and gas company that does business with the repressive government in Sudan.

Employment practices

In the past, MRTI has addressed such employment-related issues as equal employment opportunity, affirmative action, pay equity and occupational safety and health.

In recent years the ecumenical community has focused on public disclosure of affirmative action/equal employment opportunity data, as required by federal law; diversification of corporate boards of directors; the use of minority vendors; and the so-called "glass ceiling" that prevents the advancement of women in corporate structures.	

Firms on this list include American International Group (insurance), Venator (formerly Woolworth's, soon to be Foot Locker), Merck (pharmaceuticals), Bed Bath & Beyond, Coca Cola and CVS (pharmacies).

Media standards

The religious community has concentrated on encouraging retail companies to restrict or stop sales of handguns and other weapons and urging toy sellers to desist from selling "pretend" guns that can be mistaken for real ones. MRTI also has tried to engage media companies on the issue of violence in programming.

Firms on this list include Toys R Us, General Electric/NBC and AT&T.

Nordstrom's and Safeco

As always during its meetings, MRTI met with representatives of local companies - in this case, Nordstrom's (upscale clothing) and Safeco (insurance).

Neal Fuller, Safeco's vice-president for finance, acknowledged that "the insurance industry has not done a very good job of addressing the changing diversity of America." 

Safeco, which was in dire financial straits a few years ago, has revitalized itself by intentionally diversifying its staff and customer base. "We have found we do best when we are present in these diversifying communities," Fuller said. 

The company has opened two urban "centers" - in downtown Seattle and in Decatur, GA (in the Atlanta area) - which offer not just insurance and investment services, but also job training and community services.

Representatives of Nordstrom's, following up on a dialogue with MRTI two years ago, outlined steps the company has taken to implement its "partnership guidelines" with 417 manufacturing plants around the world that produce apparel for Nordstrom's.

During the 2000 discussions, MRTI members generally approved of the guidelines but questioned Nordstrom's enforcement efforts.	

This year the MRTI chair, James Newland, a retired banker from Athens, GA, praised Nordstrom's for making its guidelines more specific and putting stronger compliance procedures in place.

Linda Pfeiffer, Nordstrom's director of compliance, credited MRTI for "helping us strengthen our commitment to doing business the right way."
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