Sprawl-Busters has joined a group called “The Make TIAA-CREF Ethical Coalition.” In an open letter sent last month to TIAA-CREF, which is America’s largest pension fund mainly for educators, the Coalition urged the fund, among other reforms, to: 1) “request that Costco close its warehouse in Cuernavava, Mexico. The company is responsible for hurting the quality of life in that city, severely damaging an archeological site, and abusing human rights. This was concluded by the Office of the High Commission for Human rights of the United Nations. 2) request that Wal-Mart close its Aurrera warehouse in Teotihuacan, Mexico. Like Costco, the company is responsible for destroying world heritage and violating human rights and civil liberties. 3) urge Wal-Mart to implement ways to lessen its destructive impact on local economies; while both Nike and Wal-Mart must stop benefiting from abusive sweatshops world-wide.” The Coalition notes that TIAA-CREF, a $300 billion fund, “prides itself on being responsive to shareholders and a ‘concerned investor’ with regard to social responsibility. The reality is that TIAA-CREF holds shares in some of the most controversial and notoriously unethical corporations, including (a) Philip Morris/Altria, responsible for Marlboro-the #1 cigarette brand among youth; (b) Nike and Wal-Mart, widely condemned for their use of sweatshop labor;(c) Unocal, the oil giant was successfully sued for human rights abuses in Burma; (d) Costco for human rights abuses and environmental destruction in Mexico; (e) and Coca Cola for human rights abuses in Columbia and marketing aimed at children.” The Coalition is now urging TIAA-CREF “to divest of shares in corporations involved in human rights violations, and public health and environmental degradation, and instead invest in socially responsible ventures such as low-income area housing/ businesses and new environmental technology.” The group explains that it has done lobbying, “and taken direct actions to promote more social responsibility within TIAA-CREF. Because of the size and prominence of TIAA-CREF, if they make the changes we desire, it can lead other large institutional investors to do the same.” The Coalition asked TIAA-CREF specifically to “Pressure Nike and Wal-Mart to end sweatshop abuses worldwide; urge Wal-Mart to stop its destructive impact on local economies and close its Teotihuacan, Mexico store — or divest from those companies if changes are not made.” Coalition members met with TIAA-CREF representatives in November, and sent them a follow up letter in February. The Fund’s Annual Meeting is this July. “At the last meeting we received assurances that they would take our concerns seriously, as their rules require; we are now awaiting real action,” says coalition spokesperson Jeffrey Ballinger. “TIAA-CREF has been a leader in some ways in promoting corporate responsibility; we want them to live up to that regarding our concerns.” One coalition member, Citizen’s Coalition, has submitted a resolution to TIAA-CREF for divestment from Costco and Wal-Mart. “Our members have witnessed firsthand the attacks on the environment, health, labor, and human culture perpetrated by irresponsible corporations,” Ballinger said. The Coalition asserts that TIAA-CREF’s economic clout gives it the power to also promote positive change, like community development, while still protecting the investment of retirees. Jaime Lagunez, representing the Mexican group, Frente Civico, said, “We view each week that goes by as time wasted without using TIAA-CREF’s economic clout to truly benefit people worldwide. We hope that TIAA-CREF will live by the implications of its new advertising tag-line, ‘Financial Services for the Greater Good’.”
TIAA-CREF sent a letter in reply to members of the Coalition regarding the request that the fund become more socially responsible in its investments. “As an institutional investor,” TIAA-CREF wrote, “we cannot publicly comment on our plans regarding our holdings in a specific company…However, in making decisions, we are guided by our fiduciary obligation to achieve investment objectives for the 3.2 million people we serve…because we exist to help build the financial futures of our participants…we will only take positions on social issues that affect shareholder value.” The letter also noted that TIAA-CREF members have “a socially responsible investing option that is one of the most popular funds of its kind, with $7 billion in assets and over 200,000 participants.” In other words, only 6% of the Fund’s investors are in the “Social Choice Account”, and just over 2% of its assets are in such accounts. Some might argue that all funds held by TIAA-CREF should be socially responsible, not just 2% of their assets. For further information about the work of the Coalition, contact Jeffrey Ballinger at [email protected] More background on the TIAA-CREF campaign can be found at their website, www.maketiaa-crefethical.org.