The SEC Continues to Debate the Issue of Shareholder Resolutions

On July 25, the Securities and Exchange Commission (SEC) released two proposals concerning the rule that gives shareholders the right to file resolutions at company annual meetings (Rule 14a-8). Though the proposals do not eliminate the right to file resolutions, as was first feared, they do suggest that future restrictions may be possible.

The filing of shareholder resolutions is one of the major advocacy tools available to investors. The General Board is an active filer, filing or co-filing as many as 20 resolutions a year on a variety of issues.

As with other socially responsible investors, the General Board is concerned with changes to Rule 14a-8. Restricting the right to file advisory shareholder resolutions would severely limit our ability to engage companies on important ESG issues.

Copies of the proposed rule changes and forms for submitting comments are available on the SEC Web site at www.sec.gov/rules/proposed.shtml. Comments must be received by October 2, 2007.

On August 29, the Social Investment Forum and the Interfaith Center on Corporate Responsibility launched a new web site (www.saveshareholderrights.org) to coordinate and encourage opposition to the SEC proposals. The complete text of their joint press release is available at www.iccr.org/news/press_releases/2007/pr_secpress082907.htm.

Additional information on this issue is available at the Social Investment Forum Web site at www.socialinvest.org/areas/news/20070725-SIFResponseToSECAttackOnShareholderRights.htm and the Interfaith Center on Corporate Responsibility Web site at www.iccr.org/news/press_releases/2007/pr_secpress072307.htm.

The General Board encourages all investors to express concern over proposed limitations to Rule 14a-8. Letters may be sent to:

Christopher Cox
Chairman
Securities and Exchange Commission
100 F Street, NE
Washington, D.C. 20549

Be sure to refer to files S7-16-07 and S7-17-07