Report fromThe Social Responsibility in Investments Committee
In light of the tragedy of September 11, the Social Responsibility in Investments (SRI) Committee met by conference call on September 14. The primary purpose of the conference call held in lieu of an in-person meeting was to formulate a set of recommendations for shareholder resolution filings by the Domestic and Foreign Missionary Society for the upcoming year for approval at the Executive Council's fall meeting.
In accordance with the Executive Council resolution of October 2000, the SRI Committee voted to refile the following resolutions, the content of which are substantially similar to those already approved by Executive Council for filing or an affirmative proxy vote previously during the present triennium:
| Issue |
|
Company(ies) |
| Board diversity |
|
BJ Services
Devon Energy
Werner Enterprises |
| Contract supplier standards |
|
Delphi Corporation
Target Corporation |
| EEO-1 disclosure |
|
ConAgra, Inc. |
| Global warming report |
|
Harley Davidson
Texaco (merging with Chevron) |
| Predatory lending |
|
Conseco
Wells Fargo |
There is one additional shareholder action that the SRI Committee voted to recommend filing that is being submitted to Executive Council for approval. There is also a resolution on disinvestment from companies with direct involvement in Sudan that the SRI Committee voted to forward to Executive Council for consideration.
The SRI Committee seeks approval to file a shareholder resolution regarding the weaponization of space; the resolution asks for a report on involvement in space-based weaponization and rationales therefor. This resolution would be filed with both Boeing Company and Lockheed Martin.
There is also church policy dating back to 1985 (General Convention) opposing Star Wars when it was designed primarily as a space-based system, in addition to a variety of policy statements on arms control and weapons proliferation. The pursuit of space-based weapon programs is likely to have significant foreign policy and military implications that are likely to both start a new arms race and to divert funds from human needs to military wants. In short, there are presently more pressing needs for federal spending -- including spending on activities for domestic security -- than on space-based weapons systems that are likely to start a new arms race and in the process harm rather than enhance our security.
Finally, in response to widespread concern in the Church and Executive Council's February 2001 statement, a resolution directing the Episcopal Church to disinvest from all companies with direct operations in Sudan was also approved by the SRI Committee to be forwarded for approval by Executive Council. The SRI Committee heard a presentation on the civil war and accompanying genocide at its spring 2001 meeting and believes that disinvestment is an appropriate action with regard to companies whose actions help to fund and to sustain the civil war. There are presently two companies in DFMS portfolios from which disinvestment would occur -- BP Amoco and Talisman Energy -- under the proposed policy.
Resolution Adopted by The Executive Council October 17, 2001
Disinvestment from companies that operate in the Sudan
Resolved, That the Executive Council meeting in Jacksonville, Florida, October 15-18, 2001, hereby adopts a policy of disinvestment from any company with direct operations in Sudan until such time that there is peace and justice in that country and directs the Treasurer to divest from any such company currently held in DFMS portfolios; and be it further
Resolved, That a copy of this resolution be sent to any company from which this Church disinvests in accordance with this policy; and be it further Resolved, That other church investors, including the Church Pension Fund, parishes, and dioceses, are urged to adopt a similar policy to the extent permissible under laws governing fiduciaries.
EXPLANATION
The civil war in Sudan has laid waste to the country's economy, with little economic production or western corporate involvement in any sector except for oil. Oil revenues, which earn Sudan between $450-500 million per year, allow the Sudanese army to purchase weapons and prosecute the war (Multinational Monitor, October 2000). In February 2001, the Executive Council noted that investments in the Sudanese oil industry "fuels the government's military efforts and systematic violence against the Sudanese people." The involvement of western oil companies -- including Talisman Energy (a Canadian company) -- pose serious ethical issues for shareholders in such companies. A May 2000 report by Amnesty International entitled "Sudan: The Human Price of Oil" concluded that "massive human rights violations by Sudanese security forces, various government-allied militias, and armed opposition groups are clearly linked to foreign companies' oil operations."
Further, it is clear that not only do oil revenues allow the Sudanese army to purchase armaments and continue to pay its armed forces, but that the generation of such revenues directly leads to human rights violations. In 1999, the United Nations' Special Rapporteur to Sudan, Leonardo Franco, stated that "long-term efforts by the various governments of the Sudan to protect oil production have included a policy of forcible population displacement in order to clear oil-producing areas and transportation of southern civilians" (cited in the Multinational Monitor, October 2000). This Church has witnessed to its belief that economic development and activity must first and foremost serve human needs, and it is clear that that current oil exploration and extraction activities do not serve human needs in Sudan, but rather enable continued war and genocide.
The entire population of Sudan has suffered during a civil war that has ranged for 34 of the last 45 years. We affirm our opposition to the religious persecution of Sudanese Christians, the abduction and enslavement of human beings, and attacks on civilian targets -- all of which are ongoing in the Sudan.
Peace and security for all of Sudan's citizens is not possible while the civil war continues. The amount of money that Sudan earns every year from oil revenue is almost identical to the amount it spends on the war. Just as this Church disinvested from South Africa and Namibia in 1985 -- not just to protest against apartheid but also to make a statement that it would not profit from apartheid, this Church undertakes a similar policy with regard to Sudan.
This policy is consistent with this Church' witness on issues related to the Sudan. The General Conventions of 1994 and 2000 affirmed the Episcopal Church of the United States of America's continuing solidarity, through prayer and witness, with the Episcopal Church of Sudan. Further, the Executive Council, at its February 2001 meeting, called upon church investors to review their financial holdings and to consider divestment, shareholder resolutions and other appropriate strategies to deter investment by companies materially engaged in the Sudanese oil industry.
This Church adopts this policy with sorrow and is hopeful that it can be reversed when there is lasting peace and justice for all of the people of Sudan. At present the only companies currently held in Episcopal Church portfolios with direct involvement and investment in Sudan are BP Amoco and Talisman Energy. BP Amoco invested $578 million in PetroChina's initial public offering; PetroChina owns 40 percent of the Greater Nile Petroleum Operating Company, which is the main entity extracting oil in Sudan. Talisman Energy owns 25 percent of the Greater Nile Petroleum Operating Company.
Shareholder Resolution on Weapons in Space
adopted by Executive Council October 17, 2001
to be filed with Lockheed Martin
RESOLVED, That the Executive Council meeting in Jacksonville, Florida, October 15-18, 2001, hereby adopts the following shareholder resolution to be filed with Lockheed Martin Corporation.
WEAPONIZATION OF SPACE
WHEREAS:
The United States military's plans to develop technologies with the potential to wage war from space are intended to enhance our collective security.
In light of the September 11, 2001 tragedy, we believe that these plans will not achieve that end.
Therefore let it be resolved:
Shareholders request the Board of Directors to provide a comprehensive report describing our Company's involvement in space-based weaponization and an assessment of the potential financial, legal, and public relations liabilities involved. The report would be made available to shareholders on request by October 2002 (withholding proprietary information and prepared at reasonable cost).
SUPPORTING STATEMENT
The proponents of this resolution believe that outer space is the common heritage of all and should be used for peaceful purposes and the well-being of all peoples. We believe that present research will soon lead to weaponization projects. We believe that shareholders deserve company transparency with regard to our company's involvement in research, development, and promotion of weapons in space. The requested report could include the following aspects:
1. Current value of outstanding contracts to develop components of the Space Command's Programs;
2. Amount of the company's own money (versus government funding) spent on in-house research and development for the Space Command program, in comparison to non-military contracts in this segment of its business;
3. The ethical and financial reasons for being involved in the Space Command Program.
We urge support for this resolution.
