Tim Smith on Shareowner Activism

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Tim Smith, an early innovators of shareowner activism in the 1970s, analyzes this year’s proxy season. Smith was head of the Interfaith Center on Corporate Responsibility. ICCR practically invented the process of filing shareholder resolutions at companies they invest in raising concern around the environmental, society, and governance — now known as ESG. For years, he attended companies’ general meetings during proxy season when investors vote on shareholder resolutions.

In the early 2000s, when Sea Change Co-Host Bill Baue wrote for SocialFunds.com, he often interviewed Smith, who chaired the Social Investment Forum, the socially responsible investing trade association. Smith remains active in shareowner activism as senior vice president of the ESG group at Walden Asset Management in Boston. Baue caught up with Smith earlier this week in New York City at the Responsible Investing Forum. There, Smith discussed the current batch of shareholder resolutions coming to vote this proxy season. In particular, he discussed a resolution Walden filed at State Street, a Boston-based bank, to review its proxy voting record and guidelines. The resolution was sparked in part by a report Baue co-authored in 2008 for Ceres characterizing State Street as “schizophrenic” for promoting some of its investment products that address climate change but voting against every single climate change resolution in all its holdings. Smith is perplexed at the no-action letter State Street sent to the US Securities and Exchange Commission requesting permission to omit the resolution from its proxy ballot this year.

Disclosure: Sea Change Media is producing podcasts for ICCR.