SHAREHOLDERS CALLING THE WORLD’S MOST POWERFUL COMPANIES TO ADDRESS THEIR IMPACTS ON PEOPLE AND PLANET. CATALYZING CORPORATE CHANGE ICCR MEMBERS CELEBRATE A SUCCESSFUL 2019 PROXY SEASON The annual filing of shareholder More than a third (108) of ICCR mem- proposals at hundreds of compa- bers’ 2019 proposals resulted in Outcomes nies across nearly every sector is an changes in policies and practices. The important tool ICCR members employ majority of these corporate commit- to help catalyze corporate change on ments secured by our members con- environmental, social and governance cerned issues of workplace diversity concerns. and inclusion (26), as well as climate change (16) and human rights (18). ICCR members will typically use proposals in conjunction with other Of the 114 proposals that went to a vote engagement strategies such as in- at 2019 annual general meetings, ten vestor letters to spur dialogue with achieved majority votes, and 69 (61%) 41% - Went to vote companies. achieved votes of 25% or greater. By 39% - Agreement Reached contrast 54.5% of member-sponsored 8% - Omitted During the 2019 proxy season ICCR resolutions achieved 25% or higher in 6% - Awaiting Result members filed 277 resolutions at 184 2018. This increasing support dem- 4% - Withdrawn for other reasons publicly-traded companies. What fol- onstrates the growing understanding lows is a brief recap of the outcome among investors that ESG factors are of our 2019 proposals and company critical to building long-term value. dialogues. B.P.: (CLIMATE CHANGE) 99.14% 2019 MAJORITY VOTES GEO GROUP: (HUMAN RIGHTS) 87.90% MALLINCKRODT GROUP: (LOBBYING) 79.70% Ten resolutions filed this season MALLINCKRODT GROUP: (OPIOIDS) 78.86% by ICCR members achieved majority votes — a clear sign WALGREENS BOOTS: (OPIOIDS) 60.53% that our members’ concerns NEWELL: (DIVERSITY) 56.60% about ESG factors are shared by MACY’S: (POLTICIAL SPENDING) 53.06% mainstream investors. MALLINCKRODT: (CLAWBACKS) 52.92% 51.30% MICROCHIP: (HUMAN RIGHTS) 52.92% TRAVELERS: (DIVERSITY) 50.90% New Corporate Commitments and Wells Fargo (Sisters of St. Corporate Challenges Our members’ engagements prompted Francis and SEIU) announced Despite last year’s new rule-making by a large number of corporate com- they would stop financing private the Securities & Exchange Commission mitments on a wide range of topics. prisons. (SEC), which many observers predicted Examples include: • Sanderson Farms agreed to stop would further limit shareholders’ ac- unnecessarily administering two • Amazon committed itself to cess to the proxy process, the number medically important antibiotics in carbon neutrality for half of its of times corporations challenged our its chickens by March 1, 2019 (As package deliveries by 2030 (Green proposals at the SEC remained steady, You Sow). Century). at 54 challenges. • Biogen acknowledged that its high • Bank of America, BNP, JPMorgan drug prices are a clear business Chase (TRI-CRI), PNC (Trillium), risk (Mercy Investment Services). Sun Trust (United Church Funds), CATALYZING CORPORATE CHANGE Agreements by Issue include respect for inmate and detainee Investor Alliance for Human Rights human rights. The Sisters of St. Francis, The Investor Alliance for Human Inclusion SEIU and other shareholders also suc- Rights, an initiative of ICCR, seeks to cessfully pressed Wells Fargo to update promote corporate respect for human Climate its business standards report with lan- rights in alignment with the UN Guid- guage acknowledging the reputational Human Rights ing Principles on Business and Human and financial risks of financing private Rights (UNGPs). To achieve this, the Al- Lobby/P. Spend. prisons. United Church Funds won a liance has published several investor commitment from SunTrust Bank to resources this year including Guidance Health include human rights in its materiality on Human Rights Due Diligence: Immi- assessment. Through dialogue, a team Sustainability gration Detention, Family Separation of investors led by the Tri-State CRI as well as three salient issue briefings Food & Water persuaded BNP Paribas and JPMorgan for the tech sector: Privacy and Data Chase to announce they would stop Protection, Freedom of Opinion and Corp. Gov. financing private prisons. Expression, and Conflict and Security. Enviro. (other) Shareholders overwhelmingly sup- Following an investor letter organized ported a detainee rights resolution filed 0510 15 20 25 30 by the Alliance, Amazon updated its by the Jesuit Conference at GEO Group, supply chain policy to include the UN- with a vote of 88%. GPs and other human rights standards. An Alliance statement sent to the EU Preventing Forced Labor through resulted in its adoption of a set of new Ethical Labor Recruitment rules requiring investor due diligence ICCR’s “No Fees” campaign seeks to on people and planet. The Alliance end exploitation of migrant workers by also directly contributed to success- prohibiting worker-paid recruitment ful corporate engagements on human fees that can lead to debt bondage. A rights at Southwest Airlines, American resolution filed by Friends Fiduciary Outdoor Brands and CoreCivic. persuaded Western Digital to commit to adopting and implementing a Helping Transportation Companies comprehensive global human rights Identify and Address Human policy applicable to all employees, HUMAN RIGHTS Trafficking contractors and suppliers, and to A resolution filed by Mercy Investment publish metrics on its human rights Services moved AMERCO to engage Human-rights focused resolutions due diligence policies and practices. with representatives from Truckers jumped significantly from 27 filings in A resolution filed by the Priests of Against Trafficking about best prac- 2018 to 49 in 2019, and raised a variety the Sacred Heart convinced Macy’s tices in helping to identify and prevent of human rights risks. to update and consolidate its human human trafficking. rights policies so that investors Investors Act on Immigration can better identify and analyze the Companies with government contracts company’s human rights risks. Prison Labor to fulfill the administration’s “zero- A resolution led by Nathan Cummings tolerance” immigration policy are at The Midwest Capuchins filed a highlighting the reputational risks of increased risk for human rights viola- resolution that led Kraft Heinz to prison labor persuaded Walmart to add tions. In 2019, 28 companies, including commit to publish a global human an annual screen for prison labor to its private prisons and the banks that fund rights policy and implement a human existing monitoring process for its vast them as well as tech companies provid- rights risk assessment. supplier network of U.S.-based goods. ing facial recognition and other surveil- lance software received resolutions Together with Amalgamated Bank, As Preventing Child Sexual highlighting human rights impacts. You Sow persuaded Corning to publicly Exploitation disclose its process for identifying The pervasiveness of mobile devices A group of investors led by the Tri-State human rights risks, including and encryption are contributing to a CRI, SEIU and Trillium Asset Manage- performance indicators based on the rise in child sexual abuse and traffick- ment helped move Bank of America prohibition of worker-paid fees and ing. Christian Brothers Investment to enhance its due diligence around confiscation of personal papers. They Services filed a resolution that per- lending to private prisons and deten- reached additional agreements with suaded Apple that action was needed tion centers. SEIU and the Jesuits were Hanes, Monster Beverage and Ralph to mitigate this risk, and the company successful in moving private prison Lauren. committed to increasing its law en- company CoreCivic to modify its senior forcement training in 2019. executive performance metrics to ICCR MEMBERS CELEBRATE A SUCCESSFUL 2019 PROXY SEASON Management at Royal Dutch Shell adopt a policy addressing deforesta- reached an agreement with a group tion and Aramark will complete its of investors led by Robeco and the transition to 100% sustainably sourced Church of England, and affirmed at soy and palm oil this year. its AGM that it would set full lifecycle emissions intensity targets, tie those targets to executive compensation, Proxy Voting Policies – and undertake a review of the com- Climate Change pany’s trade association memberships. This year investors continued to Similarly, BP management joined challenge large asset management CLIMATE CHANGE shareholders in supporting a resolu- firms’ proxy voting policies on climate tion filed by ICCR members working resolutions. Walden Asset Manage- Achieving Reduction of Green- with the Climate Action 100+ coalition ment filed a resolution that persuaded house Gases that called on the company to adopt Artisan Partners to agree to update Our members continued to address the a business strategy in line with the its proxy voting guidelines to address escalating climate crisis by securing goals of the Paris Agreement. Given climate concerns. a string of corporate commitments on the recognized risks associated with GHG reduction and renewable energy climate change, BP’s board backed the Four Companies Commit to use. A resolution filed by Green Cen- proposal, and issued a public state- Sustainability Reporting tury Capital Management persuaded ment in support of the EPA directly Trillium’s resolutions moved Acuity Amazon to commit to a target of car- regulating methane emissions (Church Brands, Middleby and Quanta Services