Date of publication: December 21, 2005
Source: Sarbanes-Oxley
The Make-TIAA-CREF Ethical coalition, comprised of worldwide organizations* dedicated to social responsibility, recently met with the powerful teachers' pension fund TIAA-CREF and asked them to take the following actions....
• Drop its stock in Philip Morris/Altria, the world's largest tobacco corporation;
• Pressure Nike and Wal-Mart to end sweatshop abuses worldwide; urge Wal- Mart to stop its destructive impact on local economies and close its Teotihuacan, Mexico store -- or divest from those companies if changes are not made;
• Urge Unocal to improve its human rights record in Burma -- or divest if changes are not made;
• Pressure retailer Costco to close its illegally constructed warehouses in Mexico and end human rights abuses -- or divest;
• Support the proxy resolution of the New York City pension funds for an independent investigation of human rights abuse associated with Coca- Cola bottling plants in Colombia -- and pressure The Coca-Cola Co. to agree to such an investigation; also, pressure Coca-Cola to end all marketing (including Coke toys, in-school marketing, and product placement) aimed at children -- or divest;
• Pledge to buy no new World Bank bonds as long as bank policies contribute to economic instability around the globe -- TIAA-CREF previously divested such holdings
Representatives of the coalition just sent a letter to top executives of TIAA-CREF as a follow-up to meeting with them in November. It lists many ways that TIAA-CREF can promote corporate responsibility. And it asks for another meeting to discuss a timetable for progress on these issues.
"At the last meeting we received assurances that they would take our concerns seriously, as their rules require; we are now awaiting real action," says coalition spokesperson Jeffrey Ballinger. "TIAA-CREF has been a leader in some ways in promoting corporate responsibility; we want them to live up to that regarding our concerns."
One coalition member is also acting through the shareholders. Citizen's Coalition is submitting a resolution to TIAA-CREF for divestment from Costco and Wal-Mart, before the February 10 deadline. "Our members have witnessed firsthand the attacks on the environment, health, labor, and human culture perpetrated by irresponsible corporations," says Ballinger.
The coalition's motto, "Out of the bad and into the good," argues that TIAA-CREF's economic clout gives it the power to also promote positive change, like community development, while still protecting the investment of retirees.
The coalition notes that TIAA-CREF'S Policy Statement on Corporate Governance promotes the importance of social responsibility and that shareholder concerns should be taken into account. Research indicates that addressing social concerns as part of an investment strategy does not hurt returns and may even improve them. Indeed, TIAA-CREF's own socially responsible Social Choice Account has been one of their best-performing funds.
We think that it is a positive indication that TIAA-CREF has been open on the issues we have raised, in particular direct investment in community projects; however, Jaime Lagunez of Frente Civico, adds "We also view each week that goes by as time wasted without using TIAA-CREF's economic clout to truly benefit people worldwide. We hope that TIAA-CREF will live by the implications of its new advertising tag-line, 'Financial Services for the Greater Good'."