In the wake of massive corporate malfeasance during the past year, shareholders have stepped forward in unprecedented numbers to hold big business accountable.
Corporate governance scandals pushed irate shareholders to file a record 1,082 resolutions by the end of June with an unprecedented 130 of them receiving more than 50 percent support from shareholders, reports Conrad MacKerron in GreenMoney Journal. This advocacy boom marks a new era in corporate governance, in which greater numbers of stockholders than ever are demanding higher levels of social responsibility and accountability. "Investors stood up to be counted using their voice," said Tim Smith, president of the Social Investment Forum and senior vice-president at Walden Asset Management. They voted to press corporations "to be responsible leaders in the areas of corporate, social, and environmental responsibility."
Indeed, shareholder resolutions broke records on dozens of issues. For instance, 39 percent of YUM! Brands (KFC, Pizza Hut, Taco Bell) shareholders approved a a resolution requiring the company to explain how policy will ensure economic, social, and environmental sustainability; 32 percent of Chevron Texaco shareholders supported renewable energy alternatives; and 80.5 percent of Avon shareholders voted for a resolution strengthen corporate governance policies. It is extremely rare for any resolution to receive the support of more than 10 percent of shareholders unless it's supported by management.
Shareholders also boasted breakthroughs on social justice issues, board diversity, computer recycling, workplace diversity, and environmental justice -- in the process reshaping the advocacy landscape for many years to come.
-- Joel Stonington
Go there>> Shareholder Advocacy 2003: A Great Leap Forward
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