Support for the genocide-free investing proposal on this year’s proxy ballot at JPMorgan Chase increased from last year, according to the preliminary results announced at the company’s annual shareholder meeting today. Adding to the negative publicity the company has received in recent days over its losses from risky trading practices, it now faces growing pressure from institutional shareholders to avoid investments tied to genocide. This year, 9.2% voted in favor of the genocide-free investing shareholder proposal compared with 7.69% in 2011.
In advance of this year’s vote, both New York and Florida state pension funds announced their support for the proposal, an unusual step for most institutions. Last year's vote included support from a variety of asset managers including T. Rowe Price, AFSCME Employees Pension Plan, Bridgeway Funds, Calvert Investments, Christian Brothers Investment Services, and Connecticut Retirement Plans and Trust Funds, among others.
JPMorgan Chase (NYSE:JPM) owns over 3.5 billion dollars worth of PetroChina (NYSE:PTR) and Sinopec (NYSE:SNP), companies widely recognized as contributing to the genocide in Sudan. Nearly half a million people in the South Kordofan and Blue Nile regions of Sudan currently are facing relentless aerial attacks, violent displacement, and starvation due to the Sudanese government’s military assaults. Ongoing government-sponsored genocide in Sudan has spanned more than two decades and resulted in the death of over 2.5 million civilians.
The genocide-free investing shareholder proposal requests “that the board institute transparent procedures to avoid holding investments in companies that, in management's judgment, substantially contribute to genocide or crimes against humanity, the most egregious violations of human rights.” The proposal was submitted to JPMorgan Chase as part of an ongoing shareholder action led by Investors Against Genocide, a citizen-led initiative, dedicated to convincing mutual funds and other investment firms to make a commitment to genocide-free investing.
The proposal was presented at the meeting by William Rosenfeld, the shareholder proponent and a co-founder of Investors Against Genocide (IAG). “I was here a year ago,” he stated. “Once JPMorgan understood the consequences of its investments, I expected the company to change its policies. Sadly, the only visible change has been that the company increased its shares in the worst company tied to genocide by 31% since the beginning of last year.”
Rosenfeld also dismissed the company’s response in its proxy statement of opposition that it holds securities “in many different capacities” implying that others are responsible for its problematic investments. “This claim ignores JPMorgan’s role in selecting investments,” he said. “Why doesn’t JPMorgan at least demonstrate good faith by acting on the shares it directly controls? If 30 states, 61 colleges, TIAA-CREF, TRowe Price, and American Funds can all take steps to avoid investments tied to genocide, why can’t JPMorgan?”
Rosenfeld challenged JPMorgan's claim that it supports US sanctions on Sudan “in letter and spirit” stating, “Since 1997, US sanctions have prohibited American companies [such as ExxonMobil] from doing business with Sudan’s oil industry,” and contrasting that with JPMorgan's large investments “in foreign companies that provide these same services.”
Since 74% of shares of JPMorgan Chase are held by institutions, rather than by individual shareholders, IAG has begun engaging with institutional investors ranging from asset managers to pension funds via private discussions, direct mail, trade conferences and advertising to improve support for the voting on genocide-free investing at JPMorgan Chase.