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July, 2008 : CORRESPONDENCE WITH TIAA-CREF

Roger W. Ferguson
CEO, TIAA-CREF

Dear Mr. Ferguson:

We talked briefly after the July 15 CREF meeting. Thanks for your welcoming words. I wanted to follow-up on a few things.

You mentioned you would look into aspects of Nike and transparency, as well as looking into Philip Morris/Altria and health concerns. What has happened thus far on those two issues? Were there other issues of social responsibility you were to follow-up on?

More globally, after you noted success with some companies in Sudan, I suggested that TIAA-CREF would benefit from a more individualized approach with companies. I proposed a three stage approach. Start with talking and resolutions and fine if that works with some companies, as it has. But if that does not work after a time, then use those more aggressive tactics listed in your governance document, in conjunction with allies (more accustomed to aggressiveness) -- why list those tactics and not use them. That will be necessary with some companies. If that doesn’t work, then at a point, divest, because engagement has not worked with those particular companies. Divestment at least draws some attention to problems that have not been addresses by a company over time.

I think that a year should be sufficient if a company is really going to make changes. Thus after two years with no substantive movement from Coca-Cola, it should be time to raise the stakes if you are indeed interested in getting them to make the humanitarian changes that are needed. Also, by my deducing, I think it has been a year with Wal-Mart, thus the same applies, at least as regards various labor issues, if not environmental (not that one can’t talk while also being tougher).

So what about further actions with Coke and Wal-Mart of the sort listed below from your document. And what about the three stage model I suggest above? Those in our Coalition are currently talking with your governance team, but a boost by you in the direction we suggest would certainly help. Our folks know our companies of concern as well as any in the world and are ready to work with your folks to most effectively move those companies in ways beneficial to all. You seem genuinely interested in our concerns. With a new TIAA-CREF administration, I hope we can move ahead.

Thanks, Neil

Neil Wollman; Ph. D.; Senior Fellow, Bentley Alliance for Ethics and Social Responsibility; Bentley College; Waltham, MA, 02452; NWollman@Bentley.edu; 260-568-0116

Our preference is for constructive engagement strategies that can utilize private communication, minimize confrontation and attain a negotiated settlement. While quiet diplomacy remains our core strategy, particularly for domestic companies, TIAA-CREF’s engagement program involves many different activities and initiatives, including the following :

 

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