|Practical advice for investing in a better world
What You Can Do
1. Vote your proxies
One of the most basic actions you can take as a shareholder activist is to watch your investment-related mail carefully and vote your proxies when you receive them. To make sure that corporate managers know that shareholders want improvements in social and environmental performance, not just increased profits, it's important to vote your proxies whenever the opportunity presents itself. Please see our Shareholder Resolution Focus List.
Visit the Interfaith Center on Corporate Responsibility for a comprehensive database of current social resolutions, along with annual meeting voting results for each.
2. Write letters
You can bolster current shareholder campaigns by writing letters to company management, communicating your concerns. When consumers and citizens join shareholder activists to pursue corporate reform, the combined pressure can achieve far more than either group would separately.
Green America provides the resources for consumers and investors looking to support shareholder efforts through letter writing campaigns. See our Action Center for current action campaigns that you can support.
3. Hold mutual funds accountable for their voting practices
As of August 21, 2004, mutual funds are required by law to disclose their voting records.
Since the managers of most traditional mutual funds tend to vote in line with corporate management—meaning they seldom support social or environmental resolutions—the current secrecy means that fund investors were often unaware of the damaging social and environmental recommendations managers are making to companies in their names.
Now you can check the Web sites of your funds to see their voting records.
You can also encourage fund managers to vote for social and environmental resolutions by:
- Keeping track of social resolutions voted on by your mutual fund managers. Let investor relations know how you feel about their votes. If fund managers have voted against a resolution you supported, tell investor relations you're disappointed, and explain why.
- If you know of a social resolution at a company that's about to come up for a vote—and your fund is invested in that company—contact the investor relations department before the vote. Recommend that fund managers support the social resolution, and explain why.
- If your fund is unresponsive to your concerns and continues to vote against social resolutions, consider switching to funds that vote in ways that support your values—and be sure to let the fund's investor relations department know why you're firing their fund.
4. Attend an annual meeting
As a shareholder, you have the right to present your views on current shareholder resolutions at the companies' annual meetings—all it takes is motivation and transportation.
Companies hold their annual meetings all over the country, so no matter where you live, there may be a meeting held near you. When you receive your proxy statement by mail, you also should receive information detailing the location, date, and time of the company's annual meeting, along with instructions for how to attend. Be sure to ask your broker or adviser for this information if you don't receive your proxy statement at home, or call the company's investor relations department for information if it's not mailed to you.
Before you go, be sure to double-check the rules for your particular meeting (in your proxy statement or by calling investor relations), because every meeting is different.
Your presence can make a difference. Other shareholders in attendance may change their votes based on the speakers at a meeting, and large turn-outs for particular resolutions attract the attention of corporate management, other shareholders, and the media.
5. Encourage your pension funds to get involved
If you have money invested in a public, labor, or private pension fund, encourage your fund managers to get involved with shareholder activism. Write letters or call and ask them to disclose how they are voting their proxies. When you're not pleased with their votes, be sure to let them know.
Gather support of coworkers or others who are invested in the same fund and approach fund managers together, asking them to support social and environmental resolutions.
6. Work with organizations
Green America and the Social Investment Forum have worked together with individual and institutional investors to help shareholders voice their concerns and push for corporate reform. Recent campaigns have helped shareholders call for AOL/Time Warner to address excessive executive compensation, for Wal-Mart to clean up labor violations by its suppliers, and for ExxonMobil to acknowledge the risks of climate change and to invest in renewable energy.
If you belong to a house of worship, or have an affiliation with a large university, the investment dollars of these large institutions can also be leveraged to improve corporate behavior. Consider organizing a group to use these investments for a voice in shareholder matters.
Alternatively, you may be able to become involved with the larger holdings of your religious denomination as a whole if it belongs to the Interfaith Center on Corporate Responsibility (ICCR). Bringing together activists across many faiths (Catholic, Episcopalian, Jewish, Mennonite, and more), ICCR members leverage the combined $100 billion of their investment portfolios to sponsor shareholder resolutions targeting tobacco advertising, the use of sweatshops, weapons proliferation, and other ills. To check whether your denomination is a part of ICCR, visit www.iccr.org.
7. Loan your shares to others
If you own one or more shares in a company and can't attend its annual meeting, you can let someone else go in your place and speak up on the issues that are important to you. If someone you know would like to attend an annual meeting as an advocate, you can make arrangements with that person directly. You'll need to send a letter stating that you're giving permission for him or her to attend the meeting in your place (two sentences giving your name, the person's name, and the date and place of the meeting is sufficient), plus proof of your share ownership. This is usually a photocopy of a statement from your broker or online stock-trading account showing that you own shares and purchased them within the required time frame. If you work with a financial planner, s/he should be able to fax you the necessary proof of ownership. The person who's attending in your place will need to bring these documents to the meeting, along with a valid photo ID. You can either send your proxy ballot by mail prior to the meeting or give it to him or her to deliver.
If dialogues and proposals fail to work when persuading a corporation to adopt a social or environmental policy, shareholder activists may turn to divestment—or selling off their shares—as a means of getting their message across. Divestment demonstrates to a corporation that socially or environmentally irresponsible actions and policies are going to negatively affect the company's bottom line. As an individual investor, you don't have to wait for a shareholder action organization to conduct a divestment campaign if you're uncomfortable with a company or mutual fund in your portfolio. If you haven't seen change for the better, you can choose to divest a company's stock on your own. Be sure to write to management and tell them why you've divested.
Learn more about socially responsible investing options »