United Methodists Call for Responsible Investing

May 05, 2003 03:38 PM EDT

CHICAGO – The United Methodist Church’s General Board of Pension and Health Benefits filed more than 32 shareholder resolutions on their $10 billion financial clout. Focusing on “triple” bottom line responsibilities, the representatives encouraged corporations to consider the financial, social and environmental aspects of investment.

According to Vidette Bullock Mixon, director of corporate relations and social concerns for the pension agency, the offered resolutions on seven general areas.

"The (companies) that received resolutions are ones in which the General Board [of Pensions and Health Benefits] has a significant investment, are traditionally located in the Chicago metro area and are leaders in their industry," said Mixon.

In addition to offering resolutions for shareholders’ proxy voting, the pension agency’s staff and representatives meet regularly with corporate management, urging them to take socially responsible positions on key issues, she said.

"Corporate advocacy includes not only raising issues but complimenting companies on positive actions they take," Mixon added.

At least one corporate giant is grateful for the church’s involvement. "The fact that faith-based organizations and other socially responsible investor groups continue to push us on a number of things, I think, keeps companies in a certain balance," Miles D. White, chairman and chief executive officer of Abbott Laboratories, told the group.

The seven areas of focus are: corporate governance; the environment; diversity; financial accountability; global accountability; affordable drugs for HIV/AIDS, tuberculosis and malaria; and the sale of weapons to military governments outside the United States.

While Mixon commended White and Abbott, a maker of pharmaceutical and medical products for its work in areas such as battling the HIV/AIDS pandemic in Africa and delivering humanitarian aid to Liberia, she said the company could do more.

"I don’t want you to think we think Abbott has done everything they could," she said. "We still continue to encourage and challenge the company to do more" in areas such as working to solve the issue of drug patents, which she said can restrict access in developing nations to critical medicines."

The pension board has also taken an active public role to ensure passage of legislation to implement U.S. President George W. Bush’s proposed plan to spend $15 billion over the next five years to fight HIV/AIDS globally.

White said the key for Abbott and other corporations is finding an appropriate balance between doing what is socially right and what is financially right and feasible, particularly in the area of combating HIV/AIDS in Africa.

"We will never be right. Somebody is going to be dissatisfied with the balance that we have drawn," he added. "We guide what we do by determining what an appropriate balance is, what we can afford to do – and yet find the balance on what we think the right thing to do is."

He explained that the company is guided by its sense of being a global citizen, which also means the company is affected by nearly any situation that arises around the world.

"As a global company, we have a stake in the outcome of issues all around the world and in today’s highly interconnected world – people are brought together more closely than ever before by a combination of transportation and information technology – we now know that wherever a problem starts or an issue arises, it is likely to reach us and reach us quickly," White added.

Regarding the HIV/AIDS pandemic in Africa, White said Abbott has been involved since 1985 and its involvement has not been limited to providing treatment but has included education, working on infrastructure for remote villages and improving hospitals.

"It’s about doing what is right because we are in a unique position to do so," he told the church council. He said that by 2007, Abbott will have invested or spent more than $100 million on programs in Africa and that amount does not include losses on drugs the company provides at cost or at a loss or lost opportunity costs.

Mixon said, although the General Board of Pensions and Health Benefits does not directly get involved with projects outside the United States, the United Methodist Church is active through other organizations in providing funds and assistance in construction of buildings and educational projects. As a church agency with considerable financial assets at its disposal, however, the pensions board will continue to wield its clout to push for social, economic and environmental improvement from the companies in which it invests, she added.

"The general board remains committed to the premise that the investor and the socially responsible company can work together to achieve results that benefit society," she said. "We are going to continue to use investment influence to hold companies to high standards of corporate responsibility."

Abbott’s White reiterated that such investment influence helps companies maintain that balance between being socially and financially responsible.

"It forces you to consider the points of view of a lot of different people," he said. "We haven’t had a conflict that I thought was difficult to talk about even if we disagreed at the end of the day."

By Pauline J.