June 19, 2013
Genocide-Free Shareowner Proposal Gains Strong Support at Fidelity Investments
by Robert Kropp
Investors Against Genocide continues its campaign to pressure mutual funds and other financial
institutions into adopting genocide-free investment policies.
Shareowners of six of the mutual funds of Fidelity Investments voted their proxies this week, and
for the third time since 2008 substantial numbers supported a proposal submitted by Investors Against Genocide (IAG) calling on the
company to adopt a genocide-free investing policy.
Despite the relative unfamiliarity of
mutual fund shareowners with proxy voting—IAG's proposal was the only one on the proxy ballot,
other than proposals on operational matters submitted by management—vote tallies at the six mutual
funds reached as high as 29.2% and none fell lower than 24.1%. The numbers are impressive, which on
the one hand should not come as a surprise as surveys reveal that an overwhelming numbers of
Americans want their investments to be genocide-free.
“Fidelity continues to own large
positions in PetroChina, a company widely recognized as the largest business partner of the
government of Sudan which is currently bombing, starving, and displacing massive numbers of its own
civilians in several regions, and whose president is wanted by the International Criminal Court for
genocide, crimes against humanity and war crimes,” Eric Cohen, Chairperson of IAG, said.
On the other hand, there is that
unfamiliarity with proxy voting by mutual fund shareowners as well as opposition to the proposal by
management. Votes earlier this season on similar proposals at Franklin Templeton and JPMorgan Chase
received substantially fewer votes although in both cases shareowner support was enough to qualify
them for the next proxy ballot. Despite their financial power and influence, accounting for almost
$12 trillion in assets under management, mutual funds are not legally bound by SEC regulations
requiring corporations to hold annual general meetings at which resolutions can be introduced and
voted on by shareowners.
“Since 1997, US sanctions have prohibited American companies
from doing business with Sudan’s oil industry,” Cohen observed at this week's meeting. “Therefore,
ExxonMobil is precluded from supporting Sudan’s oil industry. But Fidelity invests hundreds of
millions of dollars in foreign companies that provide these same services. Fidelity's investments
in companies such as PetroChina clearly conflicts with the spirit, if not the letter, of the law.”
“By opposing the proposal in the voting today, Fidelity has lost an opportunity to hear
that voice” of its customers, Cohen continued. However, Fidelity will have another chance, because
genocide-free investing has already been submitted to 41 other Fidelity mutual funds and Investors
Against Genocide will be coordinating additional submissions.”
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