maketiaa-crefethical.org

Sixteenth "official" TIAA-CREF (TC) Coalition Update --mainly for TC participants with an interest in social responsibility by TC

--More details will come later, but we are planning now for the Monday morning, July 19 TIAA-CREF (TC) annual meeting in New York. We welcome your participation in a few ways we will let you know about-- and do let colleagues know about. As before, if you can’t come, please let us know if you are willing to designate someone connected with our campaign to go in your place as your representative to express views on social responsibility. It’s pretty easy to do, requiring just a little paperwork. (If you did so for last meeting, we are planning on contacting you anyway; but to be sure, please let us know.)

--At the bottom here is the new introductory message for our Make TIAA-CREF Ethical coalition. Please distribute this as widely as you can. That will build our network.

--For those that take a particular interest in seeing that TIAA-CREF invest in positive ventures as well as avoid companies not so responsible, see piece at bottom on the Social Choice for Social Change effort – and latest development on that.

--We are engaging in various actions right now to catch the attention of TIAA-CREF and their lack of responsiveness to our concerns (fliering at events where TC has a presence; mini-demonstrations at local TC offices nationwide, etc.). We recently got a letter from TC (after many months) essentially rejecting our call for divesting from particular companies. We see divestment as a viable means that reflects TC’s policy statements. However, we have noted that they can, in many instances, meet our interests if they vigorously attempt to influence the corporate behavior of its portfolio companies of concern – and give evidence of that. Doing so directly fits with TC’s past advocacy efforts, but they have not addressed us on that option (see at bottom here the detailed letter we sent them in February.)

--One encouraging sign is TC has just hired a new “Director of Social Investing,” due (in large part) to pressure from our campaign, we are sure. She is an insider in the socially responsible investment field who has promoted good ideas, though is conservative in approach in a few ways. There are a few positive signs already since she has started, but we will have to see how much they force her to toe the company line.

--TC also did recently make one important change in their socially responsible fund due to campaign efforts (voting the shares they hold in portfolio companies using soc respon guidelines). We are pushing for them to further influence companies via the “quiet diplomacy” they have utilized otherwise with portfolio companies on corporate governance issues. This could have implications for some of the target companies, for our coalition, where we seek divestment or influence as discussed above.

--One of our fellow travelers notes the following, which is relevant to the issue just noted:

“Elena has now confirmed with TIAA-CREF that the fund opted to abstain from the vote on the ExxonMobil shareholder resolution. As with their abstention on the Freeport vote, we should consider this a win! In the past, they have voted with management against similar shareholder resolutions. Could you let your networks know the good news?” --Abigail

--Some bad news is that we were turned down from having included on the next shareholder ballot (for July 19 annual meeting) a resolution that would require TC to either pressure Costco and Wal-Mart to change certain of their current activities, or to divest from those companies. We moved through some stages, but were eventually turned down by the SEC. (Costco and Wal-Mart are two of our target companies.)

The nation's largest pension fund, TIAA-CREF, a retirement fund mainly for educators, prides itself on being responsive to shareholders and a "concerned investor" with regard to social responsibility. The reality is that TIAA-CREF holds shares in some of the most controversial and notoriously unethical corporations, including Altria/Philip Morris, responsible for Marlboro-the #1 cigarette brand among youth; Nike and Wal-Mart, widely condemned for their use of sweatshop labor-- and other bad practices for the latter company regarding domestic labor, sprawl, and effects on local economies; Unocal, the oil giant currently being sued for human rights abuses in Burma. And Coke for human rights and environmental abuses overseas—and advertising to children in the U.S. TIAA-CREF has now sold all its World Bank bonds, which have resulted in harm to many Third World citizens, but it needs to assert that it will not buy any new ones. Such investment by TIAA-CREF violates certain principles in their Policy Statement on Corporate Governance—and is inconsistent with their advertising tagline of “… investing for the greater good.”

A coalition of groups urges the pension system to influence these companies to change these practices or to divest of shares in these corporations involved in human rights violations, and public health and environmental degradation, and instead invest in socially responsible ventures. We have done lobbying and taken direct actions to promote more social responsibility within TIAA-CREF. Because of the size and prominence of TIAA-CREF, if they make the changes we desire, it can lead other large institutional investors to do the same. Go to www.makeTIAA-CREFethical.org to get more detail on the effort. If you want to receive monthly (approximately) updates on the campaign, write nwollman@bentley.edu and say “send MTCE updates” in the subject line. The updates present current news on the effort, as well as give ways you can become involved.

Neil Wollman; Ph. D.; Senior Fellow, Peace Studies Institute; Professor of Psychology; Manchester College, North Manchester, IN 46962; nwollman@bentley.edu; 260-982-5346

Do you want your money to help build housing and businesses in low-income communities?

Spend five minutes to support our proposed changes in TIAA-CREF’s socially responsible fund.

In the 1980s, participants lobbied the pension giant TIAA-CREF (TC) for five years to set up a socially responsible fund, the Social Choice Account. Now we are pushing for an improved fund with practices that are becoming standard in socially responsible investing (see below). Our effort has been endorsed by many academic and activist groups, and individuals like Noam Chomsky and Howard Zinn. (See below for a history of the campaign, including discussion of why we are restarting the effort after TC reneged on certain commitments. Our web site is www.makeTIAA-CREFethical.org/SocialChoiceForSocialChange.html )

n CONTACT TC and ask them to modify the Social Choice Account by investing in low-income area community development and in social venture capital for companies pioneering socially responsible products/services. Thank them for agreeing to vote their shares in corporate stock in a socially responsible manner, and ask them to otherwise lobby those companies to be socially responsible. If you are a participant, let them know that. Call CEO Herbert Allison at 800-842-2733; 212-490-9000 (monthly, if you can) or email him at HAllison@tiaa-cref.org (but calls are preferable. You will be asked to leave a message with an assistant.)

n RECEIVE CAMPAIGN UPDATES (every two to four weeks). Contact nwollman@bentley.edu to be added to the list.

n FORWARD THIS MESSAGE with a short personal endorsement to listserves, organizations, and your colleagues and friends nationally.

We are also part of a national coalition of activist groups that is pushing for TC to be more socially and environmentally responsible in its various investments--see http://www.makeTIAA-CREFethical.org/ for more information.

For further information, contact Neil Wollman, Ph.D.; Senior Fellow, Peace Studies Institute; Professor of Psychology; Manchester College, North Manchester, IN 46962; nwollman@bentley.edu .

Social Choice for Social Change: TIAA-CREF Broke Its Promises, We Restart the Campaign

Since 1984, we have lobbied educational pension giant ($300 billion) TIAA-CREF (TC) to be more socially responsible in its investing. They resisted our efforts for years, but as a result of our pressure and dialogue, TC created a socially responsible fund (the Social Choice Account (SCA), now with $6 billion in investments).

For over five years we have pressured TC to further improve the SCA by adding (a) low-income area community investment; (b) social venture capital (in new companies promoting socially and environmentally responsible products/services); (c) shareholder advocacy (voting on shareholder resolutions and lobbying portfolio companies to advance social and environmental responsibility); and screening investments by using positive (not just negative/exclusionary) criteria, thus seeking companies that make a positive contribution to society. All of these are quite feasible and have been done successfully in other socially responsible mutual funds. They are also consistent with TC’s own Policy Statement on Corporate Governance and advertisements, in which it TC asserts its interest in and promotion of corporate and social responsibility.

Not only are these changes doable, but they are clearly supported by SCA participants. For example, we got hundreds of SCA participants to pledge that they would transfer $17 million of their TC assets into such a fund if it was established. And an earlier survey taken by TC itself found that over 80 percent of SCA participants supported investing in more positive ventures (and two-thirds were even willing to give up some level of return if such investing led to positive social change!). The campaign has been endorsed by dozens of academic and activist groups. We organized and led a national coalition of groups seeking for TC to be more responsible in its investing--investing in positive ventures and divesting from socially irresponsible companies (www.makeTIAA-CREFethical.org).

Using a variety of tactics—getting publicity to the public, generating hundreds of calls and emails to TC’s offices, leafleting at conferences where TC representatives spoke, doing demonstrations—we finally succeeded in getting TC to listen.. In 2002 they made one important change (positive screening) and in April 2004, TC officers finally agreed to seriously address our proposal and subsequently made various commitments to move forward. However, though we stuck with our promise to put our public campaign on hold, TC has made very little concrete progress in implementing the changes we requested. We finally made an ultimatum in April, ‘05: take concrete steps (which we detailed in a letter to them), or we will restart the campaign. After we received a “noncommittal, but let’s keep talking” reply in late April, they sent a letter in May agreeing to vote proxies for the SCA in a socially responsible way, but explicitly rejecting community development and social venture capital investment. Of course, the complete rejection of such investment totally contradicts statements they made over the year before, letting us know that working together we could make what we want happen. Commitments were made and broken and thus we restarted our public campaign

And so the campaign is back in full gear. We need your help if we are to succeed again. Even if you are not in the TC retirement system, you can promote the campaign.

· Most importantly, contact TC to express your support for the changes to the SCA described above. (If you are a TC participant, note that.) Call CEO Herbert Allison at 800-842-2733; 212-490-9000 (ask for him and leave a message with his assistant). You can email him at HAllison@tiaa-cref.org, but a call is much preferable. If you can call once a month, that’s even better.

· Sign up for campaign updates (email nwollman@bentley.edu to receive one or two updates monthly; also, you can receive updates on the work of the broader “Make TIAA-CREF ethical” coalition).

· Let us know (nwollman@bentley.edu ) which of the following you can do, as your time allows:
a. contact or ‘adopt’ a TC trustee in your area
b. visit a local TC office
c. participate in demonstrations or leafleting in your area (or at annual TC meetings; e.g. July 19, 2005 in New York City)

d. contact media
e. further promote the issue to colleagues beyond forwarding this message
f. ask your organization/institution to endorse our effort, then tell TC
g. express your concerns to TC representatives visiting your campus
h. get creative: cook up some new tactics, or suggest them to us

We appreciate your interest, manifested in our November 1 meeting, in the social responsibility issues we have raised. Our concern is with the practices of a limited number of the companies in which you invest. We consider such practices to be harmful to the quality of life for millions world wide. Such practices also impact TIAA-CREF and its participants, as you imply in your Policy Statement on Corporate Governance:

TIAA-CREF believes that building long-term shareholder value is consistent with directors’ giving careful consideration to issues of social responsibility and the common good. We recognize that efforts to promote good corporate citizenship may serve to enhance a company’s reputation and long-term economic performance, and we encourage boards of both U.S. and international companies to adopt policies and practices that promote corporate citizenship and establish open channels of communication with shareholders, employees, customers, suppliers and the larger community.

Your policy statement also implies that TIAA-CREF has social responsibility concerns beyond the bottom line. You indicate that you will vote favorably on particular shareholder resolutions dealing with social responsibility--seemingly because it’s the right thing to do. We have read your policy statement guidelines closely and find within it room for your supporting resolutions calling for divestment.

You have noted that you remain invested in companies that some might consider as having questionable practices because it enables you to monitor and have a voice in company policies. In most cases our request is for your remaining in such companies for that purpose, but to be transparent and specific in your efforts to monitor and influence along these lines. We further ask that after a certain time period, perhaps stated publicly if not just privately, that you divest if changes are not made. Publicly divesting is an additional way to loudly voice your opinion.

At the meeting you noted that it is difficult to move against particular companies given the varied opinion of your large clientele. In response we note that CalPERS, another large pension system with a diverse clientele, has seen fit to sometimes divest or not invest in companies due at least in part to social concerns. At least one other state pension fund does, as well. We summarize our requests regarding particular companies with the following:

--Philip Morris/Altria has been legally proven to be responsible for thousands of tobacco related deaths world wide. It should not be in any TIAA-CREF portfolio.

--TIAA-CREF should request that Costco close its warehouse in Cuernavava, Mexico. The company is responsible for hurting the quality of life in that city, severely damaging an archeological site, and abusing human rights. This was concluded by the Office of the High Commission for Human rights of the United Nations.

--TIAA-CREF should request that Wal-Mart close its Aurrera warehouse in Teotihuacan, Mexico. Like Costco, the company is responsible for destroying world heritage and violating human rights and civil liberties.

-- The fund should urge Wal-Mart to implement ways to lessen its destructive impact on local economies; while both Nike and Wal-Mart must stop benefiting from abusive sweatshops world-wide.

--TIAA-CREF should pressure Unocal to stop financially supporting a Burmese government that has one of the world’s worst human rights records. Unocal recently lost a U.S. court case that found them liable for such abuses.

--We thank TIAA-CREF for divesting from World Bank bonds. We ask that it publicly pledge to buy no new bonds as long as WB policies contribute to economic hardship globally.

--. Since our November meeting, we have added Coca-Cola to our list of companies we wish TIAA-CREF to act on. At home, Coca-Cola’s marketing practices have helped contribute to an epidemic of childhood obesity; abroad, Coca-Cola is responsible for serious human rights violations at its bottling plants in Colombia. TIAFF-CREF should pressure Coke to end all marketing to children and agree to an independent investigation of the human rights abuses at its Colombian bottling plants.

There are experts within our coalition who can speak to the issues raised above. They are ready to talk to you to present appropriate background information.

Finally, we feel it is essential to maintain communication starting with a meeting to discuss a timetable for progress on these issues. We want to speak favorably to others about a fund that shows concerns of this sort. Please do note that each week that goes by is time that TIAA-CREF could have used its economic and moral clout to benefit people worldwide. Indeed, we hope that TIAA-CREF will live by the implications, if not the intentions, of its new advertising tag-line “Financial services for the greater good.”

* The US Campaign for Burma * Corporate Accountability International* World Bank Bonds Boycott * Press for Change * Social Choice for Social Change * Canadian Committee To Combat Crimes Against Humanity (CCCCH) * Citizens Coalition (Frente Civico)* Educating for Justice * National Community Reinvestment Coalition * National Congress for Community Economic Development* Campaign to stop Killer Coke/Corporate Campaign, Inc*Campaign for a Commercial-Free Childhood*