Lutheran Investors Inspire Corporate America

     CHICAGO (ELCA) -- In the 25 years the Interfaith Center on Corporate Responsibility has been operating, American corporations have changed their views of religious investors, and religious investors have "wised up" to what makes corporate America tick.  That's what Timothy H. Smith, ICCR executive director, told the Evangelical Lutheran Church in America's (ELCA) Advisory Committee on Corporate Social Responsibility meeting here Jan. 18.
     "Initially a lot of corporations were very hostile when religious groups as shareholders raised questions with them. What they felt was that outsiders were trying to meddle in the decisions they were trying to make," Smith said.  Those attitudes began to change as other "large institutional investors" began raising the same questions about "social and governance issues."
     "A modern and sensitive corporation is going to be one that is in tune with its investors, listening to them and trying to teach their investors lessons that they have learned as executives in that company," he said.
     "Initially we raised important social and moral issues with business and hoped that business could change, sometimes very quickly," said Smith.  "Now, while we still come as people who are committed to `gospel values' and a prophetic witness, we also understand much more of what makes a corporation move, what shapes it."
     "Religious organizations have become much more sophisticated about corporations," he said.  Corporations are much more willing to listen when they are convinced that change can improve the bottom line.
     As shareholders Lutherans want the companies to be successful, said Marian Nickelson, ELCA director for corporate social responsibility.  The ideal is a cooperative effort that would "improve their bottom line, and improve their relationship with their employees and with their shareholders."
     Nickelson reported on dialogues with a dozen corporations on such topics as equal employment opportunity, diversity of boards of directors, global corporate standards, the environment and U.S.-owned factories in Mexico.
     The advisory committee has recommended that in 1997 the ELCA use its shareholder status to effect change in three general areas -- health care, energy and the environment, and equality in the workplace.
     Various ELCA institutions benefit from stocks held by endowments and foundations.  The church's Board of Pensions, seminaries, colleges, social ministry organizations and some congregations make up a network of ELCA shareholders.
     The ELCA Division for Church in Society, through its advisory committee, counsels the shareholder network on resolutions expressing the concerns of the church they could offer the corporations.  The division works with its counterparts in 275 Protestant, Catholic and Jewish organizations through the ICCR office in New York.
     "Our goal is not so much to file a resolution and raise the issue but to change corporate behavior.  The resolution is just one tool for doing that," Smith said.
     Generally, resolutions are filed with corporations before the end of each year in preparation for stockholder meetings to be held the following spring.  Many resolutions are withdrawn before reaching the stockholder meetings because they prompt significant dialogues between the filer and the corporation's management.
     Smith said many religious investors, like the ELCA, move in three directions to effect change in corporate America:

     *    "Sometimes they screen out investments in certain
          companies.  They won't own stock in companies they feel
          undercut their moral values."

     *    "Churches have defined their role as advocates trying
          to raise questions with companies, encouraging
          companies to change."

     *    "Increasingly religious investors are taking a portion
          of their investment portfolio, and they're investing it
          in community economic development programs and
          projects."

For information contact:
Ann Hafften, Director (773) 380-2958 or NEWS@ELCA.ORG
http://www.elca.org/co/news/current.html