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  • Volume Eight, Number Five: July 2003

    Shareholder Action Summer Report Card

    Perry Abbey 

    With proxy voting season winding down for 2003 its time to check the scorecard and poke a little fun at the participants.

    This year so far has turned into one of the busiest years for shareholder activists ever in Canada, with some 64 different resolutions filed with 38 different companies. In the US, the number this year was a whopping 1,034 filed so far. The majority of the resolutions were aimed at corporate governance issues around board composition, stock option plans, and accounting issues--popular issues in a post Enron world.

    On both sides of the border about 23 per cent of the resolutions dealt with social and environmental issues and this is where my interest level begins to rise. Lets look at some of the highlights and my (totally scientific and unbiased) schools out for summer letter grade:

    Responsible Water Use: Coke and Pepsi: 

    ·       Coke gets a B for actually having a water team and plan in place. Who Knew! Withdrawn.  Filers RA, TR

    ·       Pepsi sent to the detention hall and gets a D- . Tried to block resolution at the SEC and lost the Pepsi challenge. 8 per cent vote at the AGM gets us the right to file again next year. Filers RA, TR
     

    Greenhouse Gas Emissions:

    ·       IPSCO Steel : Poor disclosure history. Gets a D+ after record 49.2 per cent vote in favour raises hope that company will join the rest of the (toxic emitters) class and hand in reports to Environment Canada. Filer: EFI

    ·       Nexen: Gets a C and withdrawal of resolution. Agrees to better reporting when the Fed’s clarify the Kyoto rules! Filer: RA, EFI, OPSEU

    ·       PetroCanada:  C- Good work in past but reporting is slipping. 7.7 per cent vote means company needs to try harder! RA, EFI, OPSEU

     

    Responsible Banking: Asking for social environmental and ethic risk reporting. Filers

                             RA, EFI, MER               

    ·       ScotiaBank: Leader of the Pack this year! Gets a B and withdrawal of resolution with good start to internal CSR project and attention in class to the section on Global Reporting Initiative (GRI). Will Consider GRI .

    ·       CIBC: C and voted “Trying Hardest to Please”  Open to Board Level dialogue and also considering GRI. Withdrawn

    ·       TD: Gets an F for non-responsiveness. But 27.1 per cent of its shareholders want student to get with it.

    ·       Royal Bank: C-  and a 10.4 per cent positive vote. Needs to try harder but shareholders don’t think they’re doing that badly.

    ·       Bank of Montreal: C  A record 29.9 per cent yes vote got BIMO’s attention and they’re back to talking about the issue! Who says size doesn’t matter! 

    Sweatshop Labour/Human Rights:

    ·       Sears Canada: Gets an F again this semester and a 7.7 per cent vote. Spending too much time at the back of the class with the other sweat hogs. Should spend more time following parent firm’s (US Sears Roebuck) actions instead of its voting habits (which owns 54 per cent of Sears Canada voting stock that makes the 7.7 per cent vote really 26 per cent of the minority shareholders) Sears Roebuck has been more progressive on this issue in the US.  Filers:  RA, WE, OPSEU

    ·       Hudson’s Bay: Gets a C+ as an improving ex-sweaty. Looking for Industry wide agreement on  supply chain standards. Withdrawn.  Filers RA, WE

    2002 Follow Up: Human Rights Campaign

    • Enbridge: Gets an A- this semester. Last year’s work 90 per cent complete! Way to go!

    Marking Key: These grades are strictly interim summer break marks subject to the whim of the author. Marks above A- are not expected this decade and all pupils are expected to improve their corporate social, ethical and environmental performance next term!

    Filers Key: RA=Real Assets; EFI= Ethical Funds; MER = Meritas Funds; TR= Trillium Asset Management; OPSEU= Ontario Public Service Employees’ Union; WE= Working Enterprises

    This is only a sampling of the filings this year. For a more serious list please refer to www.share.ca for an updated list of shareholder proposals in Canada and www.socialfunds.com/sa/status.cgi for the US list.  More on the specific campaigns on www.realassets.ca and www.ethicalfunds.com

    Perry Abbey is an investment advisor at United Capital Securities Inc. a Working Enterprises company. Helping individuals and organizations harmonize their money with their values and leverage capital for change.





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