Understanding the Power of Our Money An Introduction to SRI (Socially Responsible Investing)

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Understanding the Power of Our MoneyAn
Introduction to SRI(Socially Responsible
Investing)

• Sister Ruth Rosenbaum, TC, PhD
• Executive Director
• CREA Center for Reflection, Education and Action
• PO Box 2507 TEL [phone]
• Hartford, CT 06146-2507 www.crea.org Email
  crea_at_crea.org

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A Story from my last Foundation Conference
A mother called
A child was in danger
The CSA HS agency she called responded
Immediatelyand with a sense of urgency
Protect the child
Assist the mother
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• Analyzing the situation
• She knew there was someone to call
• The response was not just for the child
• But also for the mother

In many other places, the response would have
been only to assist the child
Response of charity
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Response of Advocacy

• Assist the mother
• Not only to provide the needed food
• But also to make sure the mother was not charged
  with abandoning her child
• AIM Keep the mother and child together
• Question How to provide what they need?

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Systemic Questions

• Where did the mother work?
• What were her wages? Did she earn a sustainable
  living wage?
• Was she able to work full-time or part-time?
• Did she receive benefits?
• Was it hard for her to find a job?...and why?

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Systemic Issues and SRI

• SRI is a tool to use the power of our investments
  to bring about systemic change
• Deciding to do SRI is about recognizing the power
  we have to bring about the systemic change we want

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Some SRI history

• Screening deciding there are things from which
  you are unwilling to make money
• Traditional sin stocks alcohol, tobacco and
  gambling
• TODAY What are the systemic sins that affect
  persons, communities, the environment? What are
  our values, as persons, as institutions, as
  communities?

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Shareholder Resolutions

• Shareholders can file shareholder resolutions on
  specific issues to address ways in which they
  want companies to change their programs, policies
  or practices..
• Shareholder Resolution Requirements
• For any publicly traded US company
• Own at least 2,000 of stock
• For at least 12 continuous months

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Example South Africa

• Question How to bring about the collapse of
  apartheid?
• Shareholders filed resolutions asking companies
  to divest from operations in South Africa
• Reasoning Taxes paid to the South African
  government by foreign companies provided the
  majority of the funding for the apartheid
  government

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Supporting Other ResolutionsProxy Voting

• What is a proxy?
• Process of Voting
• Sample issues

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Shareholder Advocacy Working for Systemic Change

• Most of the shareholder work these days involves
  extensive and complicated dialogues and
  negotiations with corporations
• Some corporations come to dialogues as a result
  of resolutions
• Others respond to letters and telephone calls
  from shareholders

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Why dialogue and negotiate?

• The issues are complicated
• There are no simple answers
• Shareholders must bring expertise to the
  negotiating table

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International Coffee Crisis

• Coffee farmers and their families around the
  world were starving because of low, low coffee
  prices on the international market
• Shareholder resolution filed with PG asked them
  to buy and sell Fair Trade certified coffee

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Expertise needed for dialogue and negotiation

• Understanding the Fair Trade system
• Understanding the coffee system how coffee gets
  from the farmer to the coffee cup
• Understanding the biology of shade grown coffee
• Understanding the role of shade grown coffee in
  water stabilization and prevention of drought
• Result PG now sells 4 types of Fair Trade
• certified coffee

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Issue Human Rights and Labor Rights in Supply
Chains

• Components in a Supply Chain
• Who benefits, who loses
• Industries using supply chains

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Issue HIV/AIDS, Malaria, TB

• Work that has been done
• Shareholder resolutions
• Assessment of corporate programs to supply
  medications
• Assessment of corporate programs to suppy
  education
• PROBLEM the Security and Exchange Commission

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Work to Write an New Resolution

• Linking it to previous work on supply chains
• Discussions with NGOs in other countries
• Discussions with NGOs in US
• Discussions with health care providers in US and
  other countries
• the new idea A Sustainability Resolution

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Using Sustainability as the Key to Assessing
HIV/AIDS, TB, Malaria Programs

• Key 1 SEC approves sustainability
  resolutions
• Key 2 Institutional shareholders vote FOR
  sustainability resolutions

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Using Sustainability as the Key to Assessing
HIV/AIDS, TB, Malaria Programs

• Key 3 Moves treatment for these diseases
  away from stigmatization and allows
  patients to be seen as functioning
  members of sustainable communities