Keeping the faith

JUN 28, 2009
A coalition of faith-based in-vestors who were pioneers in the shareholder activist movement is getting set for its 40th anniversary with the launch of an educational series. Last month, the Interfaith Center on Corporate Responsibility of New York unveiled the first audio podcast on its website, iccr.org, marking the first of 12 monthly presentations leading up to the beginning of its 40th fiscal year in June 2010. What started as a coalition of a half dozen Protestant institutional investors has grown to nearly 300 investors across a range of faiths, representing more than $100 billion in assets. The center formed in 1971 when the Episcopal Church and six other Protestant denominations formed a partnership to use their combined financial strength to oppose the Vietnam War, according to executive director Laura Berry. That year, the Episcopal Church filed a shareholder resolution asking General Motors Corp. of Detroit to stop doing business in South Africa because of apartheid, leading the way for other institutional investors to follow suit. The center has focused on so-called sustainability issues, which include environmental, social and governance concerns. Investing under sustainability guidelines means examining companies for their management practices such as internal governance, how they treat employees and the communities around them. “How we value companies will predict how well the company will do,” Ms. Berry said. “Good governance leads to good management, which leads to the creation of value in companies, which leads to good investment performance.” Last year alone, center members filed 390 resolutions, representing 83% of all social-action-focused shareholder resolutions in the United States, according to Ms. Berry. “About $1 out of every $9 invested in the U.S. today is with some kind of social criterion,” she said. “We think that will grow to $1 out of $4 by 2012.”

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