Nuns, friars invest with a purpose

Posted: Friday, September 08, 2000

RICHMOND, Va. (AP) -- When the Rev. Michael Crosby attends the annual meeting of Philip Morris shareholders, he recalls the image of John the Baptist, his voice crying out in the wilderness.

''There are some people there who would just love to see you go away,'' said Crosby, a Capuchin Franciscan friar from Milwaukee who has been attending Philip Morris meetings as a stockholder for the last 20 years. ''Sometimes people will say, 'If you don't like the stock, sell it and go back to church.'''

But Crosby has no intention of selling. Since 1980, Crosby and the Midwest Capuchin Franciscans have owned a piece of Philip Morris for the specific purpose of having a voice within the company.

Crosby calls it ''buying a pulpit.'' He's used that pulpit to urge Philip Morris to change its ways.

Crosby feels less alone at Philip Morris meetings these days. Increasingly, religious groups are able to dominate the agenda at corporations' annual meetings, offering a bevy of social justice proposals on the environment, Third World debt, nuclear power and other issues.

This year, General Electric, Wal-Mart, Merck pharmaceuticals, ExxonMobil and many other corporations were confronted with shareholder resolutions offered by religious orders.

Diane Bratcher, a spokeswoman with the Interfaith Center on Corporate Responsibility, which coordinates many such resolutions, said her organization has grown to 275 member groups with $110 billion of investments. They represent Catholic, Protestant and Jewish denominations, though some city and union pension funds are also affiliated, she said.

''We've grown significantly in the last 30 years, and the growth has been steady,'' Bratcher said.

The interfaith center began with a Protestant bent, but most of its growth has come from Catholic orders, Bratcher said. About 200 of its member organizations are Catholic, she said.

''Because of the securities rules, it's easy to get a company's attention,'' Bratcher said. ''They have to address a shareholder's resolution.''

Winning a shareholder vote is another story. Crosby said there has never been an Interfaith Center resolution that achieved a majority vote from stockholders when the company's board of directors opposed it.

''Quite frankly it's a victory when we get 3 percent,'' said Cathy Rowan, coordinator of corporate social responsibility for the Maryknoll Sisters in Maryknoll, N.Y. In some cases a 3 percent vote is what a group needs under Securities and Exchange Commission rules to offer the same proposal next year.

Still, there are victories. Several years ago, 3M's board of directors agreed to an Interfaith Center proposal to limit tobacco advertising on billboards owned by a subsidiary.

And Philip Morris directors agreed to a proposal from Crosby to support legislation to put tobacco behind the counter where it would be less accessible to minors.

In fact, Philip Morris attorneys used that as evidence to defend itself in the recent smokers' class-action suit in Florida, saying it showed the company had changed its ways. In rebuttal testimony, Crosby characterized Philip Morris' acceptance of his request as ''a baby step.''

''You can't be co-opted,'' he said. ''If we say anything positive, they'll use it.''

Philip Morris spokesman Nick Rolli declined to comment.

Maryknoll was one of four religious groups to offer shareholder proposals at this year's annual meeting of General Electric shareholders in Richmond.

Proposals dealt with a variety of issues, from executive pay to arms exports. The Maryknoll Sisters were concerned with pollution of the Hudson River, saying that GE had a responsibility to clean up 1.3 million pounds of chemicals it dumped there from 1947 to 1977.

Louise Binns, a GE spokeswoman, said the company treats all shareholder proposals seriously.

''We don't really make any distinctions between religious investors and non-religious investors,'' she said.

Often, said Bratcher of the Interfaith Center, a religious order will have a specific issue it wishes to pursue -- executive pay, for example. The order examines policies of the corporations it already owns. If it feels an improvement can be made, it will lobby for a change, using shareholder resolutions only if informal discussions aren't successful.

Most groups have ''screens'' that prohibit certain investments. Crosby's Franciscans, for instance, refuse to invest in any company connected with abortion or that derives more than 10 percent of its revenues from nuclear weapons.

More often, though, the religious orders try to engage the company from the inside.

''It's a question of strategies,'' Rowan said. ''It's hard in this world to remain totally on the outside. ... What we're doing as people of faith is trying to walk on some common ground.''

Or, as Crosby put it, ''We're admonished to go into the whole world and bring the values of the Gospel. And that includes the corporate world.''


On the Net:

Interfaith Center on Corporate Responsibility:

General Electric 2000 proxy statement:

Philip Morris 2000 proxy statement: xt

End Adv for Friday, Sept. 8

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