Contact: Jack Ucciferri – 707.252.6166
FOR IMMEDIATE RELEASE
March 12, 2008
Napa, California
Sunoco Excludes Shareholder Proposal on Sustainability
The Securities and Exchange Commission (SEC) has struck a blow against the environment by allowing Sunoco (SUN) to exclude a bylaw resolution authorizing the creation of a Board Committee on Sustainability. The shareowner resolution was filed by Harrington Investments, Inc., (HII) a socially responsible investment advisory firm.
"They fought hard to exclude this modest proposal from their proxy. I was surprised and disappointed that SUN was so resistant to the notion that strategic management of sustainability related issues is part of the board's fiduciary responsibility to shareowners, especially given the company's reputation as the first Fortune 500 signatory to the Ceres principles," said John Harrington, CEO of Harrington Investments.
In recent years, SUN has wavered in demonstrating a commitment to the nonbinding Ceres Principles, one of which states "We will… sustain a process that ensures that the Board of Directors...are fully responsible for environmental policy."
"I had hoped that Sunoco would not take the word ‘nonbinding' quite so literally," continued Harrington.
"Sunoco's resistance to this binding bylaw proposal reveals the major flaw in most corporate social responsibility (CSR) efforts - corporate managers will do, say, or sign anything to make their company look good - but anything that lacks an enforcement mechanism amounts to a public relations move, or greenwashing."
In response to the Harrington proposal, Sunoco changed the name of its "Public Affairs Committee," to the "Governance and Corporate Responsibility Committee."
"I guess some people would call that a small victory! I think it is meaningless if it means that the board is repudiating fiduciary responsibility for sustainability related issues."
While binding bylaw resolutions are still a relatively untested approach to shareowner advocacy, "We believe that if corporate irresponsibility continues to impose undue costs on shareholders, bylaw resolutions will be increasingly relied upon to responsibly advocate for better corporate performance," concluded Harrington.
Ceres is the largest coalition of investors, environmental and public interest organizations in North America. The Ceres Principles are a ten-point code of corporate environmental conduct that is intended to be publicly endorsed by companies as an environmental mission statement or ethic. Imbedded in that code of conduct is the mandate to report periodically on environmental management structures and results. In 1993, following lengthy negotiations, Sunoco became the first Fortune 500 company to endorse the Ceres Principles.
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