April, 2007 correspondence with TIAA-CREF
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From: Wollman, Neil J. Sent: Sat 4/7/2007 3:06 AM To: jwilcox@tiaa-cref.org Cc: cpeterson@tiaa-cref.org; a'obrien@tiaa-cref.org; sbudde@tiaa-cref.org; smahida@tiaa-cref.org; HCHOI@tiaa-cref.org; HMA@tiaa-cref.org Subject: YOUR RESPONSE TO PAT kENSCHAFT Dear John: Thanks for your comments, below, to Professor Pat Kenschaft. Not sure if I have much new to report or say in response, as all has been covered previously. I'll just note briefly that previous record. You, of course, have our proposals for our six target companies and know what we are seeking in engaging each company, presumably via strategies listed in your revised policy statement, and that you had discussed with us previously--from discussions to litigation, from public discourse to collaborations with other interest groups, and so on). Beyond our general rationale, we designed our specific proposals to be consistent with criteria (for choosing engagements) you discussed with us and subsequently appeared in the statement. There is compatibility in content areas with the policy statement and shareholder interests (your survey), particularly concerning human/labor rights. Our coalition group reps, some of whom you met previously (Jim Keady, Al Norman, and Ray Rogers) are likely the preeminent experts and spokespersons for those looking to reform the practices of some of our target companies (Nike, Wal-Mart, and Coco-Cola, respectively). If our proposals are not sufficient for your summer deliberations on new advocacy engagements, those individuals and others are ready anytime to further strategize on applying your engagement tools to our concerns. Let us know how to proceed if further discussions would be helpful. We look forward to your decisions over the summer and working with you on implementation. P.S. Though we seek shareholder advocacy, we still see partial or total divestment as a viable strategy to effect change, especially where such advocacy fails or is not attempted. Different reps in our coalition have differing views on how important is such divestment. Neil Wollman; Ph. D. Make TIAA-CREF Ethical Senior Fellow, Peace Studies Institute; Professor of Psychology Manchester College North Manchester, IN 46962 nwollman@bentley.edu; 260-982-5346 ---------- Forwarded message ---------- Date: Wed, 4 Apr 2007 13:30:28 -0400 From: "Wilcox, John" To: Pat Kenschaft Cc: "Peterson, Chad W" "O'Brien, Amy M." "Budde, Scott" "Mahida, Sonal" "Choi, Hye-Won" Subject: RE: thank you Dear Pat: Thank you for your comments, which I will pass on to our Asset Management team. Your points abut the long-term viability of tobacco companies and wholesale retailers are valid, particularly given our long-term investment outlook. As I mentioned yesterday, I hope you and your colleagues will read our Policy Statement on Corporate Governance with a view to developing shareholder resolutions and engagement strategies that are in line with TIAA-CREF's mission and fiduciary responsibilities, thereby enabling us to give you our support in the form of favorable proxy votes and further engagement with the companies of concern to you. Best regards, John Wilcox -----Original Message----- From: Pat Kenschaft [mailto:kenschaft@pegasus.montclair.edu] Sent: Wednesday, April 04, 2007 11:55 AM To: Wilcox, John Subject: thank you It was good to meet you yesterday, and have a chance to share ideas. Yes, you are right that without financial health, TIAA-CREF would not be the ideal retirement provider. As I said, at the moment I am even more aware of its excellent services around the time of retirement, bu t that does not contradict the validity of your assertion. However, I do wonder about the financial prudence of being so heavily invested in tobacco and Wal-Mart. If the international Convention becomes widely adopted and people worldwide rethink their use of tobacco, Phillip-Morris may not have anywhere to turn now that it has shed Kraft. Last evening I noticed that another fund I am involved in had divested from all tobacco stocks in the past six months. My own passion against tobacco may affect my opinions, but the fact that 60,000 people each year die from second-hand smoke compared to 40,000 from automobile accidents indicates the enormity of the problem and the implications financially should the public become aware of the basic facts of tobacco use. As I said to you personally yesterday, Wal-Mart poses different issues. We will continue to need retail stories, but as the price of petroleum rises, the cheap international shipping on which Wal-Mart's finances are based is in jeopardy. Some people project a rapid rise in petroleum prices within the next decade. Of course, other corporations would be drastically affected too, but Wal-Mart seems especially vulnerable. As you said repeatedly, if the publicity against specific companies leads to boycotts and other adverse conditions, that certainly affects financial considerations. The implications for TIAA-CREF are not obvious, as you said. Ironically, one of the results of my conversation with you was an increased suspicion that partial divestment might be wise, but I certainly don't personally feel that I "know" this. It makes me feel good to know that TIAA-CREF is being guided by people like you and Mr. Allison. I look forward to working with you in the future. Pat Kenschaft =========================================================================================== |
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