PROFITING FROM GENOCIDE

When you invest in a corporation or a mutual fund that holds stock in corporations, you have the right as a shareholder to vote on issues raised at the corporation's annual meeting. Oftentimes, the voting at those meetings is for which candidates, or slate of candidates, will receive a seat on the corporation's board of directors, but sometimes, other interesting issues are brought to the table for a shareholders' vote, and those issues can be quite contentious.

For example, when opposition to South Africa's apartheid was reaching its peak in the late 1980's, many corporate shareholder annual meetings held votes on whether that particular company would continue doing business with South Africa or South African corporations. Opponents of apartheid hoped that outside economic pressure would eventually lead to its demise, and their efforts were eventually successful, but not without considerable opposition from corporate boards and the large shareholders who controlled them. For most corporate board of directors and their largest investors, profits, not improved social policy are the measure of corporation's success.

I raise this issue because a mutual fund proxy ballot arrived in the mail last week, and one of the resolutions being voted upon was an "anti-genocide" measure. You'd think a measure like that would be a "slam dunk winner". After all, who's pro-genocide, except perhaps, a handful of brutal dictators? Surely, they couldn't hold that much sway over an American corporation! But then I noticed that the Board of Directors of the corporation in question was recommending that shareholders vote down the proposal. What gives?

I'll tell you what gives: MONEY!

It seems that many corporate boards have no shame when it comes to where or how their profits are made. As long as it's legal, it's fair game…even if that game involves genocide.

Earlier this year, the board of directors of JPMorgan Chase fought a corporate resolution offered by "Investors Against Genocide" (IAG), a shareholder group that is fighting countries that permit genocide in the same manner groups fought South Africa for permitting apartheid. Despite the efforts of the JPMorgan Chase board to prevent the resolution from coming to a vote, the Securities and Exchange Commission notified the banking giant that "Investors Against Genocide" was entitled to a vote on the resolution. Whether it passes remains to be seen, but at least shareholders will have an opportunity to vote on the matter.

The drive to end genocide in places like Darfur in the Sudan will not be an easy goal to accomplish, but many of us can't say that there is nothing we can do about the matter. There is. We can vote! Our vote may not carry the day, but it's a start!