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
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Shareholder Advocacy 2003: A Great Leap Forward
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