Human rights

And you thought G.I. Joe was already green…

December 8, 2011

GI Joe has been green since 1964, when the action figure first went into battle for toymaker Hasbro.

Now his plastic and cardboard packaging will be environmentally-friendly, too.

So will the packaging for such beloved toys and games as Mr. Potato Head, Play-Doh, Monopoly and Candyland, all of which, along with more recent phenomena like Littlest Pet Shop and  the Transformers, are made by Hasbro, a Pawtucket, RI-based firm that sold about $4 billion of toys last year.

Hasbro releases its first corporate social responsibility report today, and it should be available here. The company offered me a preview of the report and a chance to talk with Brian Goldner, the company’s CEO, and Kathrin Belliveau, vice president of corporate responsibility at Hasbro. [click to continue…]

{ 0 comments }

Fair Trade: Even in tough times, growing fast

September 29, 2011

The proliferation of labels and claims at the grocery store can befuddle even the most conscientious consumer. What to buy? Organic produce? Locally grown vegetables? MSC-certified fish? Fair Trade coffee or chocolate?

Paul Rice, the president and CEO of Fair Trade USA, isn’t worried by the clutter. All the labels, he says, reflect a big trend–the growing appetite of food shoppers for  more “transparency and traceability.”

Says Rice: “Consumers want to know where their stuff is coming from. They want to know if it’s safe. They want to know if it’s healthy. They want to know what the impact is on the environment.”

“Consumers are increasingly using their purchasing decisions to express their values,” he says.

Of course, we’ve been hearing for decades that consumers are voting with their dollars; the trouble is, too many of us vote for crap too much of the time. But–and this is important–there’s good news when it comes to Fair Trade: Despite the sluggish US economy, it’s growing fast.

Sales of Fair Trade Certified products at mainstream grocery stores grew by 87 percent in the second quarter of 2011 over the previous quarter, according to recent data from  SPINS, which tracks the natural foods industry. Sales in the specialty and gourmet channels grew by 32 percent, for an overall growth rate of 63 percent.

What’s more, the range of products that are Fair Trade certified is expanding rapidly to include not just coffee, tea, cocoa and bananas, all which are grown in the tropics, but also sugar, flowers, honey, herbs and spices, beans and grains, wine and, most recently, apparel and sports equipment.

[Disclosure: After I'd begun writing this story, the people at Fair Trade USA, which is the leading independent certifier of Fair Trade products in the U.S., sent me a basket of goodies that included coffee, tea, chocolate bars, honey, Honest Cocoa Nova, Pink Guava Drizzle and a soccer ball. Let me know, please, if you've got a great recipe that calls for Pink Guava Drizzle.]

I spoke via Skype the other day with Paul Rice and Robert Grgrurev, a brand manager at Green & Black’s Organic chocolate which is going 100% Fair Trade, to learn more about Fair Trade and its impact. [click to continue…]

{ 5 comments }

Investments in genocide, hidden from view

November 30, 2010

Here’s what Eric Cohen, the chairperson of Investors Against Genocide, told a congressional hearing today:

It has been over 12 years since the U.S. imposed sanctions on Sudan and noted serious human rights abuses, seven years since the Darfur genocide began, six years since Congress declared it a genocide, and five years since the movement for targeted divestment from Sudan began Yet most financial institutions are still investing in the worst companies funding the genocide, and, through the fund offerings of these investment firms, millions of Americans are caught in the web of these problem investments, almost always unknowingly and without the possibility of choosing.

Tragically, he’s got a point. Better, he’s got a proposal–a requirement that mutual funds disclose whether they chose to be “genocide-free,” which is simpler than it sounds. Better yet, he had a receptive audience on Capitol Hill–Rep. Gregory Meeks of New York and Gary Miller of California, who are the chairman and ranking member of a subcommittee of the House Committee on Financial Services, as well as such interested legislators as Mike Capuano of Massachusetts, who has been active on Sudan issues. Congress could act to mandate fuller disclosure from the mutual fund industry next year.

Genocide in Darfur

Investors Against Genocide has been campaigning against money management firms that own stock in companies that do business in Sudan since 2006. (See Fidelity’s Sudan Problem at fortune.com and  Fidelity, Vanguard and the genocide in Darfur) The group has asked financial institutions to avoid investments in foreign firms that are known to substantially contribute to genocide or crimes against humanity, an approach it calls “genocide-free investing.” (U.S. companies can’t operate in Sudan) Socially responsible mutual fund families Calvert Investments and Domini Social Investments have also taken a leadership role, cleansing their portfolios of companies doing business in Sudan and asking others to do so. As Domini’s general counsel, Adam Kazner, told the submcommittee:

Investors are not simply passive actors in this system – they are playing a critical capital allocation role, and should be mindful of the implications of their investment decisions.

Congress has stepped up to the plate before. In 2007, it passed the Sudan Accountability and Divestment Act (SADA), which prohibits the government from contracting with companies doing business in Sudan and supports state and local divestment efforts. Thirty-five U.S. states have enacted legislation or adopted policies affecting investments related to Sudan, primarily in response to the Darfur crisis and Sudan’s designation by the U.S. government as a state sponsor of terrorism.

So what’s the problem? Essentially this–a small group of foreign companies continue to operate in Sudan. According to Cohen:

In Sudan, the CNPC group (including PetroChina), the Sinopec group, Petronas and ONGC are internationally recognized as providing the government of Sudan with the funding needed to support the genocide in Darfur. The government of Sudan has used 70% of its oil revenue to provide arms and funding for the genocide. Some of these same problem companies are also active in Burma and Iran.

Some U.S.-based mutual funds then invest in those companies. Fidelity, Vanguard and Franklin Templeton have been singled out by Investors Against Genocide for holding shares in Chinese oil companies.

No one from the  fund industry testified before Congress. Fidelity has said that stopping the genocide is a matter for government officials, not mutual fund managers, while Vanguard has said it has a human rights policy, while continuing to invest in companies doing business in Sudan.

Shareholder proposals calling for divestment were defeated at Vanguard and Fidelity funds, but that’s no surprise since most mutual funds investors automatically vote their proxies with managements. It’s safe to say that most investors would rather not see even a tiny fraction of their money supporting genocide in Sudan, or winding its way to Iran or Burma, with their terrible human rights records.

Investors Against Genocide has scored a couple of big victories. TIAA-CREF, to its great credit, first lobbied the Chinese oil firms to get out of Sudan and then sold its holdings. (Here’s the fund’s announcement.) The American Funds group also sold its stock in PetroChina, but did so without explanation.  Cohen told me: “I congratulate them even though they won’t say anything publicly.”

Some investors have taken note. Last May, the Unitarian Universalist Association’s Board of Trustees announced that it would end a 10 year relationship with Fidelity and move their $178 million retirement accounts to TIAA-CREF in order to be genocide-free.

You can read all the testimony, as well as a GAO report on the issue, here. Cohen’s testimony provides specifics on how genocide-free disclosure would work. Mutual funds would be required to disclose if they have a policy prohibiting investments in countries that have been subject to U.S. government sanctions for human rights violations. Right now, they report on their holdings only once a quarter, and their human rights policies, if any, can be hard to find.

Says Cohen: “Right now you need a doctorate in research to have a clue about who’s on what side.”

This seems like a classic example of investors’ right to know. Transparency would shed some light on the values of the investment firm, and we can hope that markets would do the rest.

{ 1 comment }

Why I love Google

January 14, 2010

Let me count the reasons why I love Google: its speedy search engine, the oodles of free storage on Gmail, Google Maps that get me where I need to go, YouTube for video sharing and time-wasting and Google Analytics, to obsess over my blog readership.

chinainventions10-hpBut seriously folks—Google’s decision this week to withdraw from China, rather than accept censorship, is a breathtaking example of corporate values at work, and a landmark moment in the history of corporate responsibility. It’s the biggest and boldest statement any American company has ever made about doing business in China.

As Rebecca MacKinnon, an Open Society fellow and expert on both China and Internet freedom put it:

They are sending a very public message – which people in China are hearing – that the Chinese government’s approach to Internet regulation is unacceptable and poisonous. They are living up to their “don’t be evil” motto – much mocked of late – and living up to their commitments to free speech and privacy as a member of the Global Network Initiative.

Because Google is one of the world’s best-known and most-admired brands, its action will also create pressure on Microsoft, GE, Wal-Mart and others to deal in a more ethical way with a country whose economic potential is so great that businesses typically turn away when China imprisons political activists, restricts religious freedom and strictly controls what its 1.3 billion people can read and see. [click to continue…]

{ 3 comments }

My five New Year’s wishes

January 3, 2010

HAPPY NEW YEAR 189Corporate America: Making the world a better place…or not.

That used to be the tagline of this blog, and it remains the standard I use to judge companies.

Are the jobs they create enabling their employees to flourish? Are their products and services improving lives? Are their shareholders earning good returns? Are they making their communities better?

Put simply, how well are they serving workers, customers, shareholders and communities?

Most companies, it seems to me, would like to serve better. To do so, they need better incentives. These incentives can take the form of government regulations (sometimes needed, but rarely optimal, because regulators often become captives of the industries they are supposed to oversee), industry standards (like sustainable forestry standards or Hollywood movie ratings, which general work well) or social expectations (like the growing desire of customers to patronize “good” businesses or avoid “bad” ones).

That brings me to my 2010 wish list. Each creates an incentive for companies to do business better.

Climate change regulation: Until Congress passes a law making it more expensive to burn fossil fuels, there’s no hope of solving the global climate crisis. This could be a simple carbon tax, the complex and pork-laden Waxman-Markey cap-and-trade bill passed by the House or the promising cap-and-dividend proposal from Senators Cantwell and Collins. Each approach has benefits and flaws, which we’ll get into some other day, but the best thing that could happen to business (and the planet) in the 12 months ahead is for the U.S., at long last, to stop allowing companies and the rest of us to pollute the atmosphere at will.

Corporate governance reform: What will it take for Congress, the SEC and America’s shareholders to recognize that so many boards of directors are failing at their job? You would think the near-collapse of the banking system would do it. Or the yawning gap between CEO pay and performance. Or the fact that so many corporate mergers end badly. The breakdown of corporate governance isn’t an easy problem to solve, but there are plenty of good ideas out there, ranging from requiring directors to win a majority of shareholder votes to finding ways to give activist shareholders more power to recall underperforming boards. The best boards will encourage companies to take a long-term and expansive view of their role in society. My friends Nell Minow (of The Corporate Library) and Bob Monks have been working heroically on these issues for decades. Reform is long overdue.

Sustainability ratings: How do the cleaning products of Seventh Generation, Method, Clorox and Tide compare? What’s the carbon footprint of a plastic bottle of Dasani, versus Aquafina or Poland Spring? Measuring the environmental impact of consumer products is a gargantuan task, and assessing the social impact is even harder. These aren’t jobs for the government. But a consortium of academics pulled together by Wal-Mart is trying to develop a sustainability index, as is a division of Underwriters Laboratory (which I wrote about here). It will take years to finish the job, but I’m hoping that Wal-Mart and UL they make real progress in the year ahead.

Human rights in China: As the economies of China and the U.S. become more intertwined, it’s incumbent on global corporations to use what clout they have to make clear that they disapprove of the way basic human rights are routinely violated in China. Companies that fear speaking out on their own should organize their peers to do so as a group. They could voice their support for political dissidents and environmental advocates, provide funding to human rights organizations and aggressively monitor the workplace and environmental practices of their suppliers. China shouldn’t be too big to fault.

Electric cars: Lots of forces have to come together for the electric car business to take off this year—a price on carbon would help, as would tax incentives for buyers and support for an infrastructure of charging stations. Most of all, consumers need to embrace electric cars—neither the automakers nor the government can force them on people, needless to say. But the environmental and national-security benefits of electric cars are so compelling that it’s my wish that 2010 become the year when electric cars move from talk to reality.

Happy New Year, blogreaders! Let’s hope 2010 is a good one for business, and for the rest of us.

{ 4 comments }

COP15: A demand for climate justice

December 13, 2009

sea_of_light.tck_Many thousands of people protested in Copenhagen yesterday and last night, demanding, among other things, climate justice. According to tcktcktck.org, which has a gallery of images, many thousands more held vigils areound the world. But what does climate justice mean?

To give you a flavor, here is a statement from an activist named Hemantha Withnage of Sri Lanka, who was speaking to a UN-backed group called the Subsidiary Body for Implementation, which oversees the Kyoto Protocol. I’m not going to comment other than to say that there is a yawning gap between the views expressed here and those heard in the halls of the United States Congress. And yet a global agreement to regulate climate will require an accord that, in some way, takes these views into account. Remember, China and India are seeking climate justice, too.

We are movements gathered under the Climate Justice Now! Network – many from the South, from developing countries.  Thousands of our members are here in Copenhagen, joining thousands of other citizens in a historic march.

We are calling for Reparations for Climate Debt, the debt that is owed by northern countries, multinational corporations, and international financial institutions to the peoples and countries of the South. This debt is owed by the North for using up more than their fair share of the earth’s capacity to absorb greenhouse gases, and in the process depriving the peoples of the [click to continue…]

{ 0 comments }

Let’s talk (carefully) about climate and population

November 17, 2009

Have you heard that we’re getting new neighbors? Demographers expect that the number of people living on earth—now about 6.8 billion—will grow to between 8 and 11 billion by 2050.

Whether population tops out at the high or the low end of those projections will have a huge impact on climate change. So population control is again claiming a place on the environmental agenda.

Nairobi slums

Nairobi slums

Oops! Did I say “population control”? I should have said “addressing population growth” or “assuring reproductive rights for women” or even “securing population justice” — because some people get very nervous when environmentalists start talking about population, and for good reason.

Yet the conversation is worth having, which is why I went to a discussion today at the Center for American Progress in Washington featuring Laurie Mazur, the editor of a new book called A Pivotal Moment: Population, Justice & The Environmental Challenge (Island Press, $30).

Mazur argues that we are at a pivotal moment, not just environmentally, because of the lethal overheating of the planet, but demographically, because, as she writes,

the ultimate size of the human population will be decided in the next decade or so.

That’s because right now the largest generation of young people in human history is coming of age. Nearly half the world’s population—some 3 billion people—is under the age of twenty-five. Those young people will, quite literally, shape the future. [click to continue…]

{ 8 comments }

Cartier goes for the gold

November 8, 2009

All too often, behind the glitter of gold are ugly environmental and social costs: Unregulated mines creating toxic wastes, child laborers working under grim conditions, rivers and bays polluted with waste. Sales of diamonds, meanwhile, have been used to finance wars in Africa. Under pressure, the jewelry industry has responded with programs to monitor the supply chains of precious metals and gems from the mine to the retailer. (Last year, in a FORTUNE story headlined Green Gold, I wrote about Wal-Mart and Tiffany’s pioneering efforts to find “sustainable gold.”) But cleaning up the mining industry is an enormous challenge, and so there are bound to be setbacks as well as gains.

Eucantera

Artisanal miner at Eurocantera

One big setback this week: A government and industry initiative set up to stop the flow of so-called conflict diamonds, known as the Kimberly Process, failed to suspend Zimbabwe even after its own investigators had found that the Zimbabwean military had organized smuggling of diamonds and assaulted other miners. According to The New York Times:

Human rights campaigners and nongovernmental organizations immediately denounced the decision, saying that the Kimberley Process had shown it was incapable of stopping gross abuses and the flouting of international standards.

Kimberly Process officials said they want to give the government a chance to come into compliance. We’ll see, but know that, for now, diamonds certified as conflict-free may be helping to finance human rights abuses in Zimbabwe.

On a more encouraging note, luxury jeweler and watch-maker Cartier is the latest retailer to look for more responsible ways to source its gold. The French-based firm recently signed an agreement to buy gold from an innovative Italian gold-mining venture based in Honduras. Globalization is a fact of life in the gold biz.

The Honduran mining venture, called Eurocantera, combines a modern alluvial gold mine (meaning that the gold is found in water, close to the surface, requiring no blasting into rock) with small-scale miners who use traditional methods of panning gold. This venture is noteworthy because it supports artisanal miners in a poor country, not only by providing them with decent wages, but by offering education in finance and technology, a free health clinic and road building that is needed to move gold to market but will provide other benefits as well to isolated villages. Put simply, it’s a well-rounded approach. [click to continue…]

{ 4 comments }

Goldman’s Hormats: A genocide problem?

August 3, 2009

Setting aside, for a moment, whether we really need yet another senior Goldman Sachs executive in a big job in Washington, the nomination of Robert Hormats to be Undersecretary of State for Economic, Energy and Agricultural Affairs raises anew troubling questions about Goldman’s role in raising money for a Chinese oil company that helped finance the genocide in Darfur.

Robert Hormats

Robert Hormats

Hormats played a leading role in defending PetroChina (NYSE:PTR) when Goldman took the Chinese oil company public in 2000. Worse, Hormats’ statements at the time, which included assurances that money from the public offering would not flow to the Sudanese government, were later investigated by the Securities and Exchange Commission, which brought a case against Goldman that the company settled for $2 million. (Here’s a Washington Post story on the settlement.)

That’s not enough money, to be sure, to matter at Goldman, but still, it makes you wonder: How much due diligence did  the Obama administration and Secretary of State Hillary Clinton do before nominating Hormats?

You’d think that misleading people about genocide might be sufficient cause to disqualify an executive, even one with impeccable Goldman ties, from a state department post.
[click to continue…]

{ 1 comment }

Vanguard’s shame

July 3, 2009

Harvard, Yale and Stanford did it. So did the pension funds of 27 states, including California and New York. And investment firm TIAA-CREF.

So why won’t Vanguard, the big mutual fund company, agree to use its influence to get big companies to stop supporting the genocide in Darfur?

At Vanguard’s shareholders meeting last week, owners of the company’s mutual funds rejected a proposal that would have required the funds to come up with ways to avoid “holding investments in companies that, in the judgment of the Board, substantially contribute to genocide or crimes against humanity.”
Fidelity Genocide

The votes weren’t even close. For the the 21 Vanguard funds reporting results, affirmative votes ranged between 7 and 17%. On its website, the company said:

An average of 89% of Vanguard shareholders voted against this proposal. The vote demonstrates that Vanguard shareholders have confidence in the funds’ board of trustees and their judgment in fulfilling their fiduciary and investment responsibilities.

Not really. Investors Against Genocide, the shareholder group that submitted the proposal, never had a chance. Proxy votes like the ones at Vanguard are almost always won by management because most investors don’t pay attention to the packages they get at home by mail.
[click to continue…]

{ 4 comments }

← Previous Entries