“If you own one share of a corporation, you can vote your proxy. If you own $2,000 of a corporation, you can file a resolution,” said Andrew Behar, CEO of As You Sow, at a recent presentation in Boulder, Colorado sponsored by Colorado Capital Management. As You Sow is a nonprofit organization that promotes corporate social and environmental responsibility through shareholder advocacy. “Shareholder advocacy is really about mobilizing financial markets for social change. . . . Environmental health and human rights degradation can be changed through shifting corporate policy”, said Behar.
Voting by proxy allows shareholders who cannot attend annual meetings to vote (usually by mail or via the internet) and have their views heard. For every share an investor owns, he or she typically gets one vote. Voting on issues raised at shareholder meetings, whether in person or by proxy, helps ordinary shareholders have a voice in influencing the policies and operations of companies of which they are an owner. Another avenue for influence is to file a shareholder resolution, which allows an investor (of $2,000 in ownership or more) to introduce an issue on which other shareholders can vote.
Examples of As You Sow’s successes in changing corporate policies are numerous, including their efforts to bring infant formula free from GMOs (genetically modified organisms) to the U.S. market. The organization has also been involved in campaigns encouraging investors to divest from fossil fuels, while urging fossil fuel companies to invest in “clean” technologies that reduce petroleum, coal, natural gas and water usage. Other causes include supporting corporate efforts to improve supply chain transparency and discourage the manufacturing of products made with conflict minerals, child labor and forced labor.
Another component of As You Sow’s mission is to ensure that investors fully understand what they are buying when they invest in mutual funds. “It’s been remarkable to me how utterly clueless people are about their actual holdings,” said Behar. “They don’t know their pension funds hold mutual funds that hold the most toxic chemical companies that are totally against every value that they hold near and dear.”
To help investors discover what’s in their mutual funds, As You Sow has several free online tools that screen companies by industry. FossilFreeFunds.org can help determine whether your savings are invested in mutual funds that include companies in the fossil fuel industry. DeforestationFreeFunds.org can screen out companies engaged in destroying rainforests to plant palm trees to produce palm oil.
You can learn more about As You Sow at www.asyousow.org.
And be sure to check out Behar’s new book, The Shareholder Action Guide: Unleash Your Hidden Powers to Hold Corporations Accountable.
CCM has identified a number of impact investments supporting various social and environmental causes that we may recommend to clients. Please contact us to discuss how to incorporate impact investing into your portfolio.
*The information contained in this blog is general in nature and is for informational purposes only.