Contact: John Harrington – 707.252.6166
FOR IMMEDIATE RELEASE
March 14, 2006
Napa, California
CHINA: They Still Don't Get It!
The SEC thwarts 3M Company's attempt to keep human rights shareholder resolution off the ballot.
3M Company was unsuccessful in convincing the Securities and Exchange Commission (SEC) to allow the corporation to exclude a shareholder resolution from the proxy material calling for management to implement the China Business Principles, which promotes human and labor rights in the People's Republic of China.
"3M Company clearly does not want shareholders to express their opinion on the human rights' issue in China," said John Harrington, President and CEO of Harrington Investments, Inc. (HII), the proponent of the resolution. "Although ultimately unsuccessful, the company's legal staff has worked very hard to keep this issue off the ballot. It makes one wonder what's going on with the company in China."
HII, a Napa, California-based socially responsible investment advisory firm, supports human and labor rights in China and filed the identical resolution with the company in 2005. It received the support of 8.4% of the 3M shareholders who cast votes, despite the company's objections on the grounds that they had already "substantially implemented" the proposal.
Harrington, however, countered that the company's supplier code of conduct and policies fell short of the provisions in the China Business Principles. The company's policies do not address all of the China Business principles: respecting freedom of association and assembly, rather than promoting it, and failing to ensure that the company does not "sell or provide products or technology in China that can be used to commit human rights violations or labor rights abuse." Furthermore, HII declared that 3M is not making sufficient efforts to implement its own policies, much less the requirements of the China Business Principles.
Since 2000, HII has been filing the China Business Principles resolution, initially at Cisco Systems and Intel Corporation. Recognizing that nearly all companies doing business in China deal with contractors engaged in human and labor rights' abuses, HII continues to ask companies to implement the provisions of the China Business Principles.
Lack of progress and/or unwillingness to seriously consider addressing human and labor rights abuses in China contributed to HII's decision to divest its holdings in the stock of Time Warner and Oracle. While the companies' lackluster stock performance was the primary reason for the decision, several other factors tipped the scales. According to Harrington, Time Warner made it clear that the company would provide information to the Chinese government on dissidents; Oracle admitted in meetings with HII that the company provided technology to the Chinese police and military.
Harrington concluded by saying: "American companies not only employ Chinese citizens, but also supply capital, industrial goods, and sophisticated technology to China and its government. It is the obligation of these American companies to ensure that their Chinese employees are not being subjected to human and labor rights' abuse and their products are not being used by the government to deny basic human rights."
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