2017-2018

Shareholder Advocacy

Azzad engages in shareholder advocacy on behalf of our clients by voting proxies and by filing resolutions and sending investor letters. Below you can find brief summaries of the investor letters we sent and the resolutions we filed for consideration at 2017 company meetings.

Shareholder advocacy refers to actions taken by shareholders to ask the companies whose stock they own to take an action or change behavior for the public good. One common way to do this is to propose shareholder resolutions to the company’s management to be brought to a vote at the company’s next annual general meeting. An individual or institution may file a shareholder resolution as long as they hold at least $2,000 worth of a company’s stock continuously for one year before filing and continue to hold at least $2,000 worth of stock through the date of the company’s annual general meeting. You can file resolutions with as many companies as you like during a given filing season; however, you can only file one resolution per company using your shares.

Shareholder resolutions may appear along with the company’s proposed changes on its proxy ballot, which all shareholders have a right to vote on. Mutual fund companies vote proxies on behalf of their clients. If you’re concerned about ethical issues with investing, it’s a good idea to find out how your mutual fund company votes. You can find Azzad’s proxy voting guidelines here.

Shareholder Resolutions

CHEVRON

Issue: No business with governments complicit in genocide — Burma

Background: The government and military of Burma (Myanmar) is committing human rights violations against its Rohingya ethnic minority to an extent that the UN has said amounts to crimes against humanity. In 2015, Chevron entered into a contract with the state-owned Myanmar Oil and Gas Enterprise to explore for oil in the Rakhine Basin.

Request: The resolution asks Chevron to evaluate the feasibility of adopting a policy of not doing business with governments that complicit in genocide or crimes against humanity as defined by the U.S. Department of State. Azzad was the lead filer; five other socially responsible asset managers co-filed.

Azzad first filed this resolution in 2016; it was the first shareholder resolution focused specifically on the Rohingya to be filed with a U.S. corporation.

EXXON

Issue: Lobbying disclosure 

Background: Honeywell spent $42 million from 2010 – 2016 on federal lobbying. These figures do not include lobbying expenditures to influence legislation in states, where Honeywell also lobbies but disclosure is uneven or absent. Honeywell does not currently disclose in full its lobbying activities or its memberships in, or payments to, trade associations.

Request: The resolution asks Honeywell to disclose its lobbying policy and procedures as well as Honeywell’s membership in and payments to any tax-exempt organization that writes and endorses model legislation.

 

Azzad was the lead filer.

BIOGEN

Issue: Drug pricing

Background: Biogen was publicly criticized in 2017 for the $750,000 first-year price tag, and $375,000 annual cost thereafter, for new spinal muscular atrophy treatment Spinraza. Congressional attention has also recently focused on the price of drugs for multiple sclerosis, including those sold by Biogen. Biogen’s executive compensation plan uses revenue and earnings per share as metrics for the annual bonus, which could reward senior executives for raising drug prices.

Request: The resolution asks Biogen to report annually how public concern over rising drug prices are integrated into compensation arrangements for its senior executives.

Azzad was the lead filer.

EQUIFAX

Issue: Cybersecurity

Background: In the summer of 2017, Equifax disclosed a massive data breach that had compromised the sensitive data of 145.5 million Americans.

Request: The resolution asks Equifax to disclose how it has increased cybersecurity protocols since the data breach and how it determines who should hold positions responsible for data security.

The resolution was filed by United Auto Workers. Azzad co-filed.

AMAZON

Issue: Diversity among senior executives

Background: Among Amazon’s top 105 executives in 2016, fewer than 25% were women, and only one executive was an underrepresented person of color. A 2016 study by Intel and Dalberg estimates the technology sector could generate $300–$370 billion in additional annual revenue if tech companies reflected the racial diversity of the talent pool.

Request: The resolution asks Amazon to assess the feasibility of integrating sustainability metrics, including metrics regarding diversity among senior executives, into the performance measures of the CEO under the Company’s compensation incentive plans.

The resolution was filed by Zevin Asset Management. Azzad co-filed.

ALPHABET (parent company of Google)

Issue: Diversity among senior executives

Background: The company remains predominantly white and male, especially in technical and leadership roles. Among Google Inc’s top 31 executives in 2016, there was only one underrepresented person of color and only four women. A 2016 study by Intel and Dalberg estimates the technology sector could generate $300–$370 billion in additional annual revenue if tech companies reflected the racial diversity of the talent pool.

Request: The resolution asks Alphabet to assess the feasibility of integrating sustainability metrics, including metrics regarding diversity among senior executives, into the performance measures of the CEO under the Company’s compensation incentive plans.

The resolution was filed by Zevin Asset Management. Azzad co-filed.

Investor Letters

Chevron: Use influence with government entities to help Rohingya crisis

Sanderson Farms: Change poultry antibiotics policy to stop routinely using medically important antibiotics

The letter was written by As You Sow and signed by investors representing more than $46 billion in assets under management.

Oil companies: Use influence with government entities to help Rohingya crisis

The letters were organized by the International Campaign for the Rohingya and Azzad, and were signed by investors representing more than $53 billion in assets.

Jewelry retailers: Stop buying Burmese gems in light of Rohingya crisis

The letters were organized by the International Campaign for the Rohingya and Azzad. In total, 24 institutions representing more than $24 billion in assets signed the letters.

Film studios: Implement a policy to not depict tobacco use in youth-rated movies

In early October, Azzad joined other asset managers in signing a letter to the CEOs of five major film studios (Comcast, Viacom, Sony, Time Warner, and 21st Century Fox) asking them to implement a policy to not depict tobacco use in youth-rated movies. According to the CDC, more than a third of 2016’s top-grossing films rated PG-13 and lower depicted smoking. The letter was organized by As You Sow and was signed by 33 organizations representing more than $64 billion in assets under management.

Letter to Nestle

Explain how Nestle is managing and working to minimize community conflicts around its North American water bottling operations. The letter was organized by Mercy Investment Services.