Top issues

Read about MRTI's current top issues:

• Israel-Palestine
• Environment
• Justice
• Peace

Engagement with corportations on Israel-Palestine issues

Background:

2004-2006: The 2004 General Assembly instructed the Committee on Mission Responsibility Through Investment (MRTI) to begin a process of “phased, selective divestment” related to corporations doing business in Israel.  Following the assembly, MRTI initiated a process consistent with General Assembly policy.  First, MRTI reviewed the 1984 GA policy on the use of divestment as a strategy for socially responsible investing, and the criteria for consideration of any recommendation for divestment.  Also reviewed was the 1985 GA policy describing the process of phased, selective divestment.  At its first meeting following the General Assembly, MRTI identified GA policy positions on the obstacles to a just peace in Israel and Palestine.  These included the ongoing violence perpetrated by Israelis and Palestinians against innocent people; the Israeli occupation of the West Bank, Gaza and East Jerusalem in violation of the Fourth Geneva Convention and United Nations resolutions; the presence of Israeli settlements in the occupied territories; the construction of the separation barrier and the need for a viable Palestinian economy to enhance the possibility of a successful Palestinian state.  These GA policies were incorporated into criteria to focus the research into corporations that may be profiting from involvement in any of the obstacles to a just peace.  MRTI also adopted a clear statement on the process of progressive engagement of any such companies that affirmed the cycle of dialogue, shareholder resolutions and proxy voting and more dialogue before MRTI would be in any position to consider recommending possible divestment action to the General Assembly.  This was reported to the GAMC, and publicized widely.

MRTI conducted research to determine which corporations, if any, met the criteria.  In August 2005, MRTI reviewed the research to select from among the identified companies an initial group to engage.  These were Caterpillar, Citigroup, ITT Industries, Motorola and United Technologies.  MRTI also maintained contact with various ecumenical partners that were committed to engaging companies on the issue of their involvement in Israel and Palestine.  These included the Episcopal Church, the Evangelical Lutheran Church in America and the United Church of Christ.

MRTI began the process of contacting and meeting with the five companies (meetings were held with Citigroup, ITT Industries and Motorola), communication with the presbyteries where the companies are headquartered, and continued interpretation of the process to the church and the general public.  MRTI also worked ecumenically on strategies for pro-active investment in Israel and Palestine by churches and corporations in consultation with Mr. James Wolfensohn, Special Envoy for the Quartet (the United States, the European Union, the United Kingdom and Russia), whose charge included helping to rebuild the Palestinian economy.

2006-2008: In 2006, the General Assembly responded to numerous overtures regarding corporate engagement on Israel-Palestine issues, and adopted a statement urging that “… financial investments of the Presbyterian Church (U.S.A.), as they pertain to Israel, Gaza, East Jerusalem and the West Bank, be invested in only peaceful pursuits, and affirm that the customary corporate engagement process of the Committee on Mission Responsibility Through Investment of our denomination is the proper vehicle for achieving this goal.”

MRTI continued its work with considerable time devoted to fostering ecumenical cooperation on engagement.  To that end, an informal table called the Ecumenical Action Group: Investment for a Just Peace in Israel / Palestine was created.  As a result, corporate dialogues were expanded to include participation by representatives of other Protestant denominations and Roman Catholic religious orders.  These have included the Episcopal Church, Evangelical Lutheran Church in America, United Church of Christ, United Methodist Church (General Board of Global Ministries, General Board of Church and Society, General Board of Pensions and Benefits and the New England Conference), United Church of Canada, Mercy Asset Management, Ursuline Sisters and the Dominican Sisters.  Also participating has been KAIROS Canada and the World Council of Churches.

Additional dialogues were held with Motorola and Citigroup. These dialogues were the first step of the corporate engagement mandated by the 216th and 217th General Assemblies. Corporate engagement is a deliberate process outlined in the basic policies of the General Assembly on socially responsible investment, dating to 1971, 1976 and 1984. Elements of this process include research, correspondence, dialogue, proxy voting and the possible filing of shareholder resolutions. Only after all other options fail to achieve the desired results, the committee on MRTI, through the General Assembly Mission Council, may recommend to the General Assembly divestment from particular corporations.

 The Citigroup dialogue was highly productive. The primary concern with Citigroup involved an allegation that Citigroup had provided insufficient controls to prevent the transfer of funds to Palestinian organizations supporting violence. In conversation with MRTI representatives, the company provided assurance that the bank had robust controls in place to monitor and prevent questionable money transfers.  There have been no subsequent reports alleging inappropriate funds transfers by Citigroup. In addition, Citigroup expressed willingness to assist the religious community with exploring how to increase microcredit lending in the region to address the lack of adequate investment opportunities in Palestine. Therefore, in June 2007, MRTI removed Citigroup from its focus list of companies for corporate engagement.

The Motorola dialogue focused on human rights standards and conventions, and explored the company’s involvement in the occupation through sales of military communications products, fuses for bombs and security technology for Jewish Israeli settlements on the West Bank.  Motorola denied that any of its activities implicate it in the Israeli occupation, or raise human rights concerns. A shareholder resolution addressing broader human rights issues was filed by several religious shareholders in the fall of 2007. In response, Motorola requested a follow-up meeting, which occurred in January 2008. The company indicated its intent to review and amend its policies but would not specify the particular changes under consideration and made clear that its human rights policies would not be applied to their business relationships with foreign governments. This lack of clarity and limited scope led the religious investors, including MRTI representatives, to decline to withdraw their resolution, which will go before the annual shareholders meeting on May 5. Although the conversation with Motorola has been less productive than hoped, religious shareholders agree that more in-depth dialogue on corporate social responsibility and human rights may potentially create a more productive arena for analyzing the Israel-Palestine conflict and other world situations and ought to be continued.

Shareholder resolutions for consideration at the 2008 annual meetings were also filed with Caterpillar, ITT Industries and United Technologies.  The resolution at Caterpillar requests the Board of Directors to review the company’s human rights policies and amend them where applicable.  Caterpillar also received a resolution on foreign military sales from a coalition of shareholders including several Roman Catholic religious orders and Jewish Voice for Peace. The resolutions at ITT Industries requested a report on foreign military sales, and at United Technologies requested that ethical criteria be applied to foreign military contracts.  The United Technologies resolution was supported by 23.8 percent of shareholders voting at the annual meeting; a very strong showing, considering resolutions of this nature submitted to major defense contractors routinely receive three to five percent of the shareholder vote. The vote was sufficient to qualify the resolution for automatic reconsideration at next year’s annual meeting, should the shareholders decide to resubmit it.

In the case of Caterpillar, there were two developments.  First, several religious shareholders sent a letter to the company requesting a meeting to discuss non-military sales of company products in Israel and Palestine.  The company replied by letter on December 13, 2007.  While not responding to the request for a meeting, the company said for the first time that “As an industry leader, Caterpillar advocates responsible use of our equipment.  We expect our customers to use the products they purchase from us in environmentally responsible ways and consistent with human rights and requirements of international humanitarian law.” 

Secondly, the resolution submitted by the Presbyterian Church (U.S.A.) and the Dominican Sisters produced a dialogue on January 30, 2008.  Caterpillar representatives reviewed their Worldwide Code of Business Conduct.  Discussion focused on the human rights dimensions of the Code, what it included or omitted, and who beyond the company’s employees it affected or not.  Religious shareholders, including MRTI representatives, raised the need to address the end-use of company products, particularly in countries with human rights challenges.  After further discussions, the shareholders agreed to withdraw the resolution from consideration at the 2008 annual meeting in exchange for an ecumenical dialogue with the company on human rights and the end use of Caterpillar products.  It is hoped that this dialogue will begin in May or June 2008.

On March 4, 2008, religious shareholders, including MRTI representatives, met with ITT Industries.  The company wanted to discuss its new corporate ethics program rather than foreign military sales.  ITT’s position is that it will not disclose its foreign military sales claiming that all the information is publicly available.  ITT had challenged the resolution at the Securities and Exchange Commission.  The SEC’s decision upholding the shareholders was announced later in March. The resolution will be considered at the ITT Industries annual meeting on May 13, 2008.

The Episcopal Church is the primary shareholder proponent with United Technologies and had a brief phone conversation with company officials.

The process of corporate engagement will be evaluated by the ecumenical participants, and strategic adjustments made for the next round of engagement.

In sum, momentum has increased, participation has broadened, and issues with companies are clearer and sharper. Although major changes in corporate policies and practices remain elusive to date, MRTI believes that the engagement process is on track and ought to be continued and completed in accordance with regular General Assembly policies governing our engagement process and in response to the 2004 and 2006 mandates. The committee is not prepared to make a final recommendation at this time regarding the corporations described above but intends to pursue its assignment with all due diligence and persistence. To this end, we offer the following recommendations:

That the 218th General Assembly (2008):

1. receive the report of the Committee on Mission Responsibility Through Investment (MRTI) of its engagement with corporations involved in Israel, Gaza, East Jerusalem and the West Bank.
2. call upon all corporations doing business in the region to confine their business activity solely to peaceful pursuits, and refrain from allowing their products or services to support or facilitate violent acts by Israelis or Palestinians against innocent civilians, construction and maintenance of settlements or Israeli-only roads in East Jerusalem and the West Bank, the Israeli military occupation of Palestinian territory and construction of the Separation Barrier as it extends beyond the 1967 “Green Line” into Palestinian territories.
3. urge all corporations doing business in the region to seek pro-active ways to promote respect for human rights, peacebuilding and equal employment opportunity.
4. direct the Committee on Mission Responsibility Through Investment (MRTI) to continue the corporate engagement process, and report on its status with any recommendations to the 2010 General Assembly.

Environment — caring for God's Creation

Caring for all of God's creation is a core value of the Presbyterian faith. The bounty and beauty of the natural world as given to us in the story of Genesis remain our responsibility. We are called to be faithful stewards and to find ways to assure that those abundant gifts are shared by all of God's people.

The toxic pollution of air, soil and water, and global climate change are concerns of the Mission Responsibility Through Investment (MRTI) committee.

The committee engages in study and dialogue with companies whose work may have an impact on these issues. Industries may include petrochemical, paper and forest products, electronics, and semi-conductor and utilities.

Corporate reporting

When a faithful investor commits money to a particular corporation, it's important to know how that company has treated the earth. That's why MRTI has worked with its partners to encourage corporations to measure and disclose their environmental impact.

Similar to the widely accepted rules for financial accounting, corporations are now asked to account for their environmental performance through a systematic, accessible and public reporting of environmental management plans and results.

MRTI has joined with Ceres, a national network of investment funds, environmental organizations and other public interest groups working to advance environmental stewardship on the part of businesses. Through this coalition, the Ceres Principles have become a standard by which companies are measured. The principles are designed to increase environmental performance by companies, coupled with public disclosure.

\More than a dozen Fortune 500 companies have endorsed the Ceres Principles. General Mills and Time Warner are the most recent, along with nearly 50 medium and small companies. Other endorsers include Bank of America, Ford, General Motors, Nike, ITT Industries, Timberland and Coca-Cola. Dialogues about endorsing the Ceres Principles are underway with several other major corporations.

Ceres also encourages companies disclose their performance according to the Global Reporting Initiative (GRI) format.

Climate change

Faithful shareholders across the country are asking electric power companies to report on the potential impact of climate change upon the company's future fiscal viability. They also want the companies to report on plans for adjusting to future regulation of carbon dioxide and the cost effectiveness of reducing greenhouse gas emissions.

MRTI met with Cinergy, now Duke Energy, at its highest levels, and reached an agreement to produce such a report.

MRTI subsequently met several times with Cinergy staff to help develop the report that was released in December 2004. Read the Air Issues Report.

Cinergy devoted its 2004 annual report to global climate change. MRTI was featured in the report for its work with the company and its perspective on the relation of climate change risks to shareholder value. Read the Presbyterian News Service story about this work.

MRTI's shareholder resolution with FirstEnergy was withdrawn when the company agreed to produce a climate risk report. It was released in December 2005.

Additional shareholder resolutions in 2005 dealing with climate received significant support:

The highest was at ExxonMobil, asking for a report on compliance with the Kyoto Protocol (28.3%), with the next one being a report on climate risk at Vintage Petroleum (25.6%). Other votes included disclosing climate data at ExxonMobil (10.3%); climate change expertise on board of directors at ExxonMobil (4.1%); fuel economy standards at General Motors (5.62%); climate risk at Bank of Nova Scotia (8.56%), Dominion Resources (8.3%), Health Care Property Investors (8.89%), Lennar Corporation (2.33%), and Ryland Group (7.9%). The fuel economy standards resolution with Ford was withdrawn.

Follow-up dialogues were held with several companies where proxy votes had been high in 2004: Apache (37.1%), Anadarko Petroleum (31.4%), Marathon (27%), ChevronTexaco (9.4%), Valero Energy (9.3%), Unocal (6.8%), and Ford (6.1%). In addition, MRTI withdrew a resolution at Nucor after the company agreed to update its corporate Web site with information about its achievements in reducing greenhouse gas emissions.

MRTI also participated in a dialogue between power companies, investors and environmental groups coordinated by Ceres that produced a report endorsing regulation of carbon, and other measures to address global warming.

What's next?

• Work with other religious shareholders to bring public awareness of ExxonMobil's efforts to challenge solutions to global warming.
• Continue MRTI's groundbreaking relationship with Duke Energy as the company updates its climate risk report and expands its efforts to reduce greenhouse gas emissions. Similar dialogues will continue with other energy companies.
• Continue to encourage companies to endorse the Ceres Principles, a national set of standards aimed at continuous environmental improvement on the part of businesses.
• Continue to encourage companies use the Global Reporting Initiative (GRI) to develop sustainability reports on the social, environmental and human rights aspects of their operations. Several companies, including Baxter International and General Motors, have pilot-tested the reporting.
• Monitor cleanup of polluted sites in the Clark Fork watershed in Montana that have resulted from mining operations. The British Petroleum subsidiary, Atlantic Richfield, is active in this area.

Justice — caring for God's people

Caring for all of God's people is a core value of the Presbyterian faith. We believe that the God revealed in the scriptures is One who showed special concern for those who most need help, particularly the poor, the hungry and those who are victims of injustice.

Social and economic justice, racial justice, and securing the rights of women are concerns of the MRTI because as Christians we are called to care for the poor, the exploited, the defenseless, and the weak.

The committee engages in a wide range of activities that use the church's investments as tools to help the PC(USA) and individual Presbyterians respond to God's demand to "do justice."

Community investing and equal access to capital

Increasing access to capital through community reinvestment and equal credit opportunity helps revitalize distressed communities.

That's why faith-based organizations, such as MRTI, urge depository-banking institutions to comply with federal laws that require them to meet the credit needs of their entire community, including low and moderate income families

Those same laws prohibit lenders from discriminating on the basis of race or color, religion, national origin, sex, marital status or age.

MRTI also supports innovative and effective lending programs in underserved areas and to underserved populations.

MRTI led the way in dialogues with Citigroup, J.P. MorganChase and Wells Fargo in discussion about lending to people of color and low-to-moderate income communities. MRTI also participated in the dialogues with Bank of America and Washington Mutual.

Supported resolutions with Republic Bank and Wells Fargo concerning payday loans. Payday loans are high interest loans where the person borrows against their next paycheck, often leading to high interest payments, and trapping the person in debt. The major banks sometimes finance payday lenders.

MRTI has pressed banks and other financial institutions to develop robust policies to guard against predatory lending.

What's next?

• Continue dialogues with Wells Fargo to help it meets its goal of being a leader in providing fair mortgages to low-to-moderate income communities and people of color. Wells Fargo is also initiating policies to strengthen safeguards against predatory lending. MRTI will continue its monitoring.
• Renew dialogue with J. P. Morgan Chase to discuss progress on the bank's commitment of reaching the industry lending average.
• Work with our faith partners in dialogues with National City and KeyCorp to explore their lending records with racial minorities in some markets.

Global corporate accountability

Caring for our neighbors is a global responsibility. Presbyterians believe that through God's grace we are called to be a "neighbor" to anyone in need; to show mercy and kindness to those who have been abandoned or mistreated regardless of geography or other barriers.

The business practices of U.S. companies in other countries, especially in terms of human rights, are a concern of MRTI because, as Christians, we consider all of God's people to be our neighbors.

Work in this area initially focused largely upon the operations of U.S. companies along the U.S./Mexico border.

The MRTI also has looked into operations in "export processing zones" in other countries, particularly in Central America and the Caribbean.

MRTI has supported the Maquiladora Standards of Conduct that address environmental contamination, health and safety of workers, standard of living for workers and community infrastructure. The Standards were issued by the Coalition for Justice in the Maquiladoras (CJM).

MRTI has expanded its focus to cover global operations, particularly in China, Bangladesh and Jordan, in cooperation with the National Labor Committee.

MRTI co-filed a resolution requesting a sustainability report by Wal-Mart. The resolution received 19.6% of the proxy vote.

Participated in dialogues about human rights policies with various companies such as Unocal, Occidental Petroleum, Chevron and Hasbro.

Following a vote of the Presbyterian General Assembly in 2004, MRTI initiated a process of phased, selective divestment of companies doing business in Israel. MRTI developed a set of six criteria focused on General Assembly concerns about violence against Palestinians and Israelis, the occupation, Israeli settlements in the occupied territories, and the Separation Barrier.

What's next?

• Continue to promote the Maquiladora Standards of Conduct in dialogues with companies using contract suppliers.
• Work for legislation to provide protections for workers in sweatshops.
• Support efforts to engage Coca-Cola concerning possible human rights violations at the bottling plants in Columbia where union leaders have been targeted by para-military organizations.
• Continue work, as directed by the PC(USA) General Assembly in 2004, on a process of phased, selective divestment from multinational corporations doing business in Israel that are detrimental to the peace process and the common good of Israelis and Palestinians.

In addition, MRTI is faithfully involved in these justice issues:

Access to health care

MRTI responded to a request from the Social Responsibility Committee of the Presbyterian Board of Pensions by joining in dialogues with pharmaceutical companies on providing affordable drugs for HIV/AIDS, malaria, TB and other diseases to developing nations.

In 2004 and 2005, MRTI co-filed shareholder proposals requesting a report on how the company was addressing the pandemic with Abbott, Merck and Pfizer. Plans include participating in dialogues with those companies.

Corporate governance

MRTI is joining with other religious shareholders to explore new strategies to engage corporations on governance standards, executive compensation and transparency.

MRTI has recommended that shareholders vote in favor of resolutions raising the issue of executive compensation review, and reports on the differential between top executives and hourly employees.

MRTI will continue educational efforts on the issues, particularly executive compensation.

Employment practices

In partnership with other faith groups, MRTI will continue its work for Equal Employment Opportunity disclosure and diversity on boards of directors and in top management. MRTI will support these efforts through proxy voting.

Rural farm crisis

MRTI is a participant in the Agribusiness Accountability Initiative, co-sponsored by the National Catholic Rural Life Conference and the Center of Concern.

Peace — seeking peace and pursuing it

"Peace is more than the absence of war, more than a precarious balance of powers. Peace is the intended order of the world with life abundant for all God's children. Peacemaking is the calling of the Christian church, for Christ is our peace who has made us one through his body on the cross."

— From Peacemaking: The Believers' Calling, 1980

Violent video games and gun sales

MRTI and its partners encourage retail companies to restrict or end sales of handguns and other weapons, and to make sure that any "toy" weapons cannot be confused with real ones.

In addition, the religious community has focused new attention on video games containing violence, racial hatred, and sexual abuse by talking to retailers about taking steps to prevent the sale of video games to children or young teens when the games possess mature or adult labels.

In 2004 and 2005, MRTI's religious partners met with the trade association of retailers about selling practices, and the adequacy of ratings. Discussions will continue with the Entertainment Software Ratings Board (ESRB).

MRTI also promoted a "Don't Buy Violent Video Games" message during the holiday season for 2005 and 2006 in conjunction with other religious groups.

Read more about the issue of violent video games and how you can help.

MRTI will continue to participate in efforts to enhance the rating standards for video games that presently are self-regulated by the industry. This will include meetings with the ESRB.

Military-related investments

Presbyterians believe that a faithful life means devoting one's spiritual and material resources to peacemaking. That includes using our investments to promote peace.

Briefly stated, the PC(USA) does not invest in some corporations engaged in military-related production, especially those that produce weapons leading to mass or indiscriminate injury and/or death to civilians.