Lessons from a shareholder initiative on climate change (1)

Issue campaigns aim to change the behavior of a company (or a sector of the business community) on a particular issue. For example, concerned shareholders have dialogued or filed resolutions on climate change, supplier relations, equal employment, etc. Many shareholder activists realize that their concerns about corporate behavior may ultimately demand a systemic approach that needs to be taken up outside the shareholder arena.

4 Main Components of Issue-Based Campaigning

Shareholders have applied basic organizing and campaigning skills to better communicate their messages and produce a particular action. There are four main components of issue campaigning, which can inform shareholder strategy.

1)  Defining the Issue

• Define your issue in a clear, limited manner.
• For the shareholder activism component, investors must define their issue and goals on a company level.
• Determine how progress at individual companies furthers your overall objectives.
• Find a means to change the political atmosphere or public opinion on your issue (e.g. make the financial argument to get investors on board, write letters to the editor to influence public opinion, solicit support from prominent individuals, reach out to governments, etc.)

• Ensure that your general message comes through in the language of your resolution. Because of SEC restrictions, the "resolved" statement in your resolution may contribute to, but not actually state, the ultimate change a shareholder would like to see in the company. (For example, although an investor may believe that his/her company would benefit from more women in senior management positions, an appropriate resolution might request a report on workplace diversity.)
• Present the resolution in a manner comprehensible to the majority of shareholders, who are purely financially oriented.
• Communicate your issue specifically to various audiences (board, top management, current and potential shareholders, etc).
• Communicate your issue generally and from the shareholder value perspective to media and public (e.g. through media coverage, press advisory, flyers, etc.). Build partnerships with groups or individuals who will lend credibility to your message.

• Think of possible follow-ups to your target audiences, and ways to involve them in the process of change.
• Consider public calls to action like voting proxies, contacting your mutual or pension fund manager, etc.

• Explore all avenues for delivering your message (Op-Eds, Letters to the Editor, news articles, paid ads, etc.
• Explore using visuals such as photo-opportunities, but be aware that there can be a tension between getting publicity and maintaining dialogue with the corporation).
• Remain professional and investment-oriented for the mainstream shareholder audience

Issue campaigners who have engaged in shareholder activity share the following cautions and lessons:

• The shareholder activism process is time-consuming and relatively slow
• One must be careful not to alienate corporations since ultimately companies will change voluntarily
• Must come to the table prepared (know your issue, have evidence, make sure you can win). Shareholder activists often invite technical experts to assist them in shareholder dialogues.
• Be patient
• Continue to keep the big picture in mind; shareholder activism is only one tactic, and other people may be pursuing other avenues
• Changes will occur from the bottom up
• Keep up communications. Make sure grassroots activists and actions are constantly updated in sync to maximize the effectiveness of current negotiations.

(1) This section was contributed by a technical expert who advised a group of shareholder activists concerned about climate change. For more information on the experiences and background of the primary contributor of this section, please see the Acknowledgments.
 

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