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| Best Practices |
Action Figures
Suzanne McGee
08/02/2004
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In any given year,
shareholders lobby corporations to pass initiatives on a range of topics.
Initiatives by veteran corporate gadflies like Monks or large institutional
investors have traditionally attracted the most attention. However, affluent
investors like Ladd are increasingly joining the corporate governance fray,
McGurn says. “It’s a fallacy that a majority of proposals made by shareholders
at annual meetings come from institutions,” he notes. “This is a relatively
straightforward form of [individual] activism.”
Of Responsible Wealth’s 700
members, several dozen are actively campaigning for changes to boardroom
structure or compensation policies, Klinger says. Each year, Responsible Wealth
focuses on a few crucial issues, he adds, and works to get them on the agendas
of corporations, shareholders and the institutional investors whose muscle gets
resolutions passed. After pinpointing the issues, Klinger identifies a handful
of large companies whose policies fall short of what he and other governance
gurus see as best practices. Finally, he polls Responsible Wealth members to see
whose investment portfolios include shares in those companies, holdings that
give the member a platform to raise the issue at the annual meeting.
“By
speaking out as a shareholder, I’m able to stand up and give permission to the
company to look beyond the financial bottom line,” Ladd explains. “Companies
feel an obligation to make as much money for their shareholders as possible, but
that shouldn’t come at the expense of good governance, of the people who work
for the company, of the community or the environment.”
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