Values in Action: 2008-2009 Shareholder Advocacy Update
Green Century Capital Management, Inc. (Green Century), a Boston based investment advisor, announced today that it has engaged with over 75 companies on some of the most pressing environmental challenges throughout the 2008-2009 advocacy season.
Key victories from this year's advocacy campaigns include:
• Nearly one-third* of ConocoPhillips** shareholders supported a Green Century proposal asking the company to assess the environmental impacts, including large climate change consequences, of its tar sands operations in Alberta.
• Green Century won further restrictions on the use of the controversial chemical bisphenol-A (BPA) when it collaborated with Whole Foods** to eliminate BPA from store products and pressured other food and beverage companies to report on their use of the chemical.
• Green Century earned several corporate accountability improvements when three companies adopted policies increasing transparency and disclosure of their political contributions and payments to trade associations.
Green Century was founded and is wholly owned by non-profit advocacy organizations to promote corporate environmental responsibility and green investing. Shareholder advocacy has been a central part of Green Century’s mission since its founding in 1991.
Green Century manages the Green Century Funds, among the first environmentally responsible mutual funds. The Funds seek competitive financial returns while providing people who care about a clean, healthy planet the opportunity to use the clout of their investment dollars to encourage sustainable corporate behavior.
This year, Green Century continued this long tradition of shareholder advocacy with a robust program that engaged numerous companies on critical environmental problems. Some of the highlights include:
Climate and Energy - Green Century worked to ensure companies fully reflect the carbon footprint of their operations. We encouraged over 40 major corporations in the S&P 500 to recognize and increase transparency of their carbon footprint by responding to the Carbon Disclosure Project annual questionnaire. In addition, much of Green Century’s work in this area centered on efforts to encourage companies engaged in tar sands development to recognize the climate risks associated with this method of oil extraction. Green Century filed shareholder resolutions with both Chevron** and ConocoPhillips* pressuring the two major oil and gas companies to increase their disclosures on the environmental damage that will result from the expansion of their operations in the Alberta tar sands. Labeled "the most destructive project on Earth" by Canada’s Environmental Defence, tar sands development has significant environmental impacts.
• Chevron: At Chevron's 2008 annual meeting, 28.6%* of shareholders representing $31.4 billion*** of shares voted in support of a resolution filed by Green Century requesting increased disclosure on the environmental impacts of company operations in the Alberta tar sands; however, the resolution was not included on this year's proxy ballot. This resolution was excluded from the ballot by Chevron. Green Century spoke at the company's annual meeting and generated media coverage to raise awareness of the environmental risks associated with tar sands development.
• ConocoPhillips: This year ConocoPhillips shareholders sent a strong message to the company when a resolution filed by Green Century and Trillium Asset Management calling for the company to fully disclose the environmental impact of its tar sands operations received over 30%* of the vote. This vote sent a strong message to ConocoPhillips and other companies operating in the tar sands that their shareholders believe that there are serious regulatory, reputational, litigation and competitive risks associated with these projects.
Toxics and Environmental Health - This spring, Green Century focused on exposing the risks companies face from the ongoing use of bisphenol A (BPA), resulting in considerable advancement by companies towards alternatives to the chemical. BPA is a synthetic sex hormone that studies have linked to developmental problems, heart disease and diabetes.
• Ranking the packaged food industry on BPA: Green Century and As You Sow sent surveys to 20 of the largest packaged food companies inquiring about their use of BPA and released the findings in a new report titled Seeking Safer Packaging. The report finds that fourteen of the largest public packaged food and beverage companies still use BPA in their packaging. Green Century will continue to engage with companies included in the report on this critical environmental health issue over the coming months.
• Whole Foods Market, Inc.: In 2006, after dialogue with Green Century, Whole Foods made a public commitment to stop selling polycarbonate baby bottles and children's sippy cups that contain BPA. Building on this success, Green Century filed a resolution with Whole Foods this year but withdrew it after the company agreed to take steps to eliminate BPA from other store products. Whole Foods also agreed to work with Green Century on initiatives pressuring can and chemical manufacturers to develop safer BPA substitutes.
• Sunoco**: Green Century asked Sunoco, one of the few companies that produce BPA about its production of the chemical. The company informed investors that it recently instituted a groundbreaking policy requiring its customers to guarantee that the chemical will not be used in food or beverage containers designed for children under three. Sunoco’s policy – the only one in the chemical industry - has been used by congressional leaders to argue for national legislation on BPA.
Corporate Accountability and Responsibility - Green Century believes that sustainable business practices should be built on policies that serve the environment and the broader public good, not short-sighted profit. Green Century works to encourage companies to increase disclosure of political contributions and other lobbying efforts and to publish sustainability reports that address climate strategies, both key attributes of a responsible company.
• Disclosure of political contributions: Green Century scored three important victories and withdrew resolutions filed with Cummins, Inc**, Whirlpool Corporation**, and Williams Companies** after each company agreed to adopt policies increasing disclosure of its political contributions and payments to trade associations. As trade associations such as the U.S. Chamber of Commerce play an increasingly key role in the political process, particularly on the issue of climate change, shareholders must know how corporate funds are spent so they can ensure that companies are not supporting trade associations whose positions conflict with their values.
• Sustainability reporting: Green Century filed shareholder resolutions with Apple Computers, Inc**, Bed, Bath & Beyond**, and Darden Restaurants** asking those companies to prepare comprehensive and transparent sustainability reports describing corporate strategies to address climate change, specifically including plans to reduce greenhouse gas emissions. Following the dictum, "what is measured is managed," sustainability reports provide a basis for benchmarking a company's environmental performance and tracking improvements from year to year.
Wilderness and Biodiversity - Green Century believes that protecting wilderness, and the species that live there, is critical for both economic and environmental sustainability.
• ExxonMobil**: We continue to pressure ExxonMobil to refrain from drilling in pristine wilderness areas such as the Arctic National Wildlife Refuge and instead invest in renewable energy sources. Green Century Director of Shareholder Advocacy Larisa Ruoff raised our concerns with the board of directors, top management, other shareholders and the media at ExxonMobil's recent annual meeting.
• Lowe’s Companies Inc.**: Green Century filed a resolution asking the company to improve stakeholder engagement in store siting, particularly regarding a controversial store planned by the company in the pristine Everglades region. Lowe's challenged Green Century's resolution and it did not appear on the agenda for the company's meeting. Even though the resolution was not on the proxy ballot, Green Century was represented at the meeting by a Florida-based environmental group. Our representative shared community concerns with top management, the board of directors, other shareholders and the media.
Green Century also worked to ensure the safety and security of our food and water. Green Century believes in equal and free access to pure, clean fresh water. As fresh water becomes increasingly polluted and scarce, we are working to ensure that our water sources remain clean, uncontaminated and conserved for future generations. Green Century has joined an initiative to pressure Home Depot** to drop its support of a dam in Chile's Patagonia region that would impact biodiversity and water supply in this critical and pristine ecosystem.
Food production in the United States has been industrialized, a development with significant implications for the ecological well-being of our food systems, crops, and animals. Green Century is working to promote healthy food and sustainable farming practices. Toward this end, we joined a coalition of investors pressuring leaders in the packaged food industry, including Kraft**, Kellogg** and General Mills** to stop using genetically-modified sugar beets in products.
"This has been an exciting and successful spring. At Green Century, we believe that environmentally responsible investing is about more than just avoiding unfriendly companies," stated Larisa Ruoff, Director of Shareholder Advocacy for Green Century. "We are committed to fostering a more sustainable economy by leveraging our rights and responsibilities as investors to directly encourage companies to adopt cleaner and healthier practices and products. And the results of our advocacy program show that we are having an impact."
Green Century engages with companies on a broad spectrum of environmental issues toward the goal of improved environmental sustainability and a healthier planet for us all. Many of the companies that the Green Century Funds invest in and which meet the Funds' standards for environmental responsibility have room for improvement. Companies that do not meet the Funds' standards, and therefore are not invested in by the Funds, are probably the most in need of improved environmental behavior. To engage with these companies, Green Century Capital Management, the Green Century Funds' advisor and administrator, buys shares in these companies to allow us to advocate for improved environmental practices. One company at a time, Green Century is working to improve our world.
* Calculated by (i) dividing the number of votes in support of the proposal by (ii) the sum of the number of votes voted in support of and against the proposal. Abstentions and broker non-votes were not included in the calculation.
** As of March 31, 2009, neither the Green Century Balanced Fund nor the Green Century Equity Fund owned Chevron Corporation or ConocoPhillips Company. As of March 31, 2009, Whole Foods was not held by the Green Century Balanced Fund and comprised 0.07% of the Green Century Equity Fund; Sunoco, Inc. was not held by the Green Century Balanced Fund and comprised 0.09% of the Green Century Equity Fund; Cummins Inc. was not held by the Green Century Balanced Fund and comprised 0.14% of the Green Century Equity Fund; Whirlpool was not held by the Green Century Balanced Fund and comprised 0.06% of the Green Century Equity Fund; Williams Company was not held by the Green Century Balanced Fund and comprised 0.17% of the Green Century Equity Fund; Apple Computer comprised 0.86% of the Green Century Balanced Fund and was not held by the Green Century Equity Fund; Bed Bath & Beyond was not held by the Green Century Balanced Fund and comprised 0.18% of the Green Century Equity Fund; Darden Restaurants was not held by the Green Century Balanced Fund and comprised 0.13% of the Green Century Equity Fund; neither the Green Century Balanced Fund nor the Green Century Equity Fund owned ExxonMobil; Lowe's was not held by the Green Century Balanced Fund and comprised 0.74% of the Green Century Equity Fund; Home Depot was not held by the Green Century Balanced Fund and comprised 1.11% of the Green Century Equity Fund; Kraft Foods was not held by the Green Century Balanced Fund and comprised 0.91% of the Green Century Equity Fund; Kellogg was not held by the Green Century Balanced Fund and comprised 0.25% of the Green Century Equity Fund; and General Mills comprised 2.13% of the Green Century Balanced Fund and 0.46% of the Green Century Equity Fund. Portfolio composition will change due to ongoing management of the Funds. Please refer to the Green Century Funds website for current information regarding the Funds’ portfolio holdings. These holdings are subject to risk as described in the Funds' prospectus. References to specific investments should not be construed as a recommendation of the securities by the Funds, their administrator, or their distributor.
*** Calculated using Chevron's closing price per share on March 31, 2008, the record date for Chevron's 2008 annual meeting.
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Green Century Capital Management is an investment advisory firm focused on environmentally responsible investing. Founded by a partnership of non-profit environmental advocacy organizations in 1991, Green Century's mission is to provide people who care about a clean, healthy planet the opportunity to use the clout of their investment dollars to encourage environmentally responsible corporate behavior. Green Century believes that shareholder advocacy is a critical component of responsible investing and actively advocates for greater corporate environmental accountability.
You should consider the Green Century Funds' investment objectives, risks, charges, and expenses carefully before investing. For a prospectus that contains this and other information about the Funds, call 1-800-93-GREEN, visit www.greencentury.com or email info@greencentury.com. Please read the prospectus carefully before investing.
The Green Century Funds are distributed by UMB Distribution Services, LLC 6/09
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