Investors to Corporations: Do You Stand with Workers—or Against Them?

by Seth Michaels, May 28, 2009

A coalition of major investors who oversee more than $750 billion in assets is joining the fight for workers’ freedom to form unions by asking major corporations what they’re doing to protect and enhance the ability of workers to form unions.

These investors want to know about these corporations’ workplace policies and whether these companies are lobbying for—or against—the Employee Free Choice Act, a critical bill to protect workers’ freedom to form unions and bargain. They’ve sent a letter to 100 CEOs asking for answers.

Investment leaders representing 36 investment funds and pension funds signed on to the letter, which they’ve sent to each company listed on the Standard & Poor’s 100 index, including major corporations like Bank of America, McDonald’s and Lowe’s.

Adam Kanzer, managing director and general counsel at Domini Social Investments LLC, says companies that respect workers’ rights are stronger and so are a better investment in the long term. He says businesses should work to build a constructive and positive relationship with workers that protects their freedoms:

We believe it is in each company’s long-term best interests to reassess their policies and procedures to ensure their employees’ rights are fully protected. We encourage companies to look to the standards set by the International Labor Organization when they establish a higher standard than U.S. law, particularly in the areas of freedom of association and collective bargaining.

The coalition behind this letter spans the globe and includes investors like Ian Greenwood, chairman of the U.K.-based Local Authority Pension Fund Forum, who says:

As long-term investors, we want companies to create value in a sustainable way. Constructive labor relations can be a positive influence on productivity, foster trust and loyalty, and help attract and retain skilled staff, therefore this is an area shareholders need to be informed about. We hope this process will give us a better understanding of how U.S. companies are addressing these challenges.

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