For more than thirty years, Harrington Investments, Inc (HII) has been challenging corporate power, and 2014 promises to be one of the most important years yet, targeting 18 different corporations with shareholder resolutions.
Interesting and new this year, Harrington is going right to the heart of the economic storm in the country by asking corporate Boards of Directors to inventory their moral and true fiduciary responsibilities to shareholders and other stakeholders.
“For the last six years this country has been slammed with news about a total breakdown in ethics in some of our largest corporations, especially financial companies,” said John Harrington, President/CEO of HII. “Trying to survive the economic meltdown, it’s clear that wealthy and powerful corporate officers and directors more than ever are out to protect and enrich themselves, mostly at the expense of the entire middle class of America.”
The resolutions, sent to the big banks largely associated with the financial crisis of 2009 including Goldman Sachs, AIG, and JPMorgan Chase, ask for reports “evaluating opportunities for clarifying and enhancing … fiduciary, moral and legal obligations to shareholders and other stakeholders.”
Telecommunications companies, Verizon and AT&T, also received similarly themed resolutions from Harrington.
AT&T was the first company to respond. In a document submitted to the Securities and Exchange Commission (SEC), corporate legal counsel for AT&T said Harrington’s proposal “in its application to corporate directors and to corporate governance generally, is entirely novel and without precedent.” They further added:
We strongly doubt that shareholders …would understand what “moral, ethical and legal fiduciary … opportunities” are – we do not know what they are…
Goldman Sachs, AIG, and Verizon have also filed legal challenges with the SEC seeking to keep Harrington’s resolutions away from shareholder’s voting powers by asking the Commission permission to omit the proposals from the companies’ proxy ballot.
“I think we’ll be seeing, sooner than later, shareholders and other stakeholders standing up to these insulated corporate directors and boards. These corporations can operate in literally thousands of locations and in hundreds of communities, but corporate management at the top has no loyalty to any local community,” Harrington continued. “The only loyalty or interest is absolute power, control and maximizing its own materialistic self-interest, and the interests of its board of directors, even if it means cheating, lying, engaging in fraud and bribery, or other illegal activities. I think shareholders are disgusted with that kind of behavior which violates common decency, morality, and acceptable human behavior.”
Harrington has also filed or co-filed shareholder resolutions protecting privacy and constitutional rights, allowing owners to nominate corporate Board members, and addressing food and water scarcity, the deepening crises surrounding genetically modified organisms (GMOs), human and labor rights, and corporate tax avoidance.
Harrington Investments, Inc is a 32-year old registered investment advisory firm based in the Napa Valley, California, managing over $180 million in assets. The firm manages individual and institutional accounts utilizing a comprehensive social and environmental screen, while engaging in shareholder advocacy, challenging corporate management on key social, environmental, and corporate governance policies. HII also invests the firm’s assets and assets of its clients in profit and non-profit organizations engaged in high social impact investments, or in companies or organizations that maximize social and environmental performance.
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