By NCPPR
In two separate victories for the National Center for Public Policy Research’s Free Enterprise Project (FEP), the nation’s leading proponent of free-market investor activism helped usher the defeat today of shareholder proposals at the annual investor meetings of Honeywell and Kraft Heinz.
Both shareholder resolutions were promoted by the As You Sow network and filed by affiliated groups. Last week, the National Center issued a press release designed to educate investors about the anti-free enterprise motives of As You Sow, and urged shareholders to reject the proposals.
At today’s Honeywell shareholder meeting in Morris Plains, New Jersey, FEP Director Justin Danhof, Esq. advised investors to reject a proposal co-filed by Azzad Asset Management and Mercy Investment Services.
At the meeting, Danhof noted:
Today, Azzad and Mercy would like to use Honeywell’s shareholders in their efforts to defund and silence the American Legislative Exchange Council (ALEC), the American Chemistry Council and the Business Roundtable. While Azzad and Mercy work to upend the free enterprise system, these organizations labor to improve America’s business environment. That’s good for Honeywell’s investors. Azzad and Mercy would probably be happy if any broken relationships caused Honeywell to cease operations altogether. How do you investors feel about that?
Honeywell’s investors followed Danhof’s advice and rejected the proposal.
“I am encouraged that we were able to help stop the Azzad/Mercy proposal today,” said Danhof. “However, much more needs to be done to stem the tide of liberal activist influence. Too many companies give credence to the As You Sow network and its affiliated groups by engaging with these liberals and negotiating. This is a terrible tactic. This corporate march toward a liberal ‘ESG’ ? Environmental, Social and Governance ? utopia need not be inevitable. I encourage investors to reject all proposals supported by the As You Sow network and I suggest that corporations not engage with these activists.”
At today’s Kraft Heinz shareholder meeting in Pittsburgh, Pennsylvania, National Center Vice President David W. Almasi represented the FEP in speaking out against a proposal designed to ultimately force the company to alter certain packaging to meet the demands of environmental groups. The proposal was defeated.
In opposing this Mercy Investment Services proposal, FEP warned that the proposal, if enacted, could handcuff corporate decision-making and cause the company to fail in its fiscal responsibility to its investors. In trying to mandate certain recyclable packaging, this proposal may have exposed the company to risks of its products being less safe, less desirable and more expensive. “Let’s not vote for a proposal that would result in lawsuits against the company,” Almasi said at the meeting.
Almasi also attended last week’s AES investor meeting where another As You Sow proposal was scheduled for a vote. However, AES negotiated a last-minute settlement with Mercy Investment Services that will force the company to report on the its progress in meeting climate policy goals set by radical environmentalists. While this removed the proposal from consideration, Almasi still spoke out during the meeting’s question-and-answer session and in private conversation with top company leaders about the need for the company to be more proactive in fighting left-wing proposals ? noting that more hostile proposals will inevitably be filed in the future since AES acquiesced this year.
“There’s blood in the water at companies like AES. While AES claims to have come to an agreement benefiting both sides, it ultimately has opened the door to a new demand next year. And another demand if it caves again,” said Almasi. “Companies under assault by anti-capitalist groups gaming the system with hostile proposals must do better in making their case to institutional investors as well as rank-and-file shareholders.”
Today’s meetings mark the 7th and 8th shareholder meetings of 2018 in which FEP has participated.
