InvestorsChallenge Natural Gas Companies to Increase Transparency, Reduce Risks toPublic Health and the Environment From Fracking Operations    Shareholders file resolutions withChevron*, Exxon Mobil*, and 8 other companies to spur more responsiblemanagement practices   Boston, MA—For a third consecutive year, concerned investors havetargeted energy exploration and production companies that rely heavily onhydraulic fracturing (fracking)and fail to disclose critical information aboutthe ways they are managing the associated risks.     Public concern about the environmentaland social impacts of fracking operations are growing across the country andcan have real business implications for the companies involved.   “Bans and moratoria are denials of companies’ sociallicense to operate and impose a wide range of costs on companies, ranging fromthe costs of delays to complete loss of access to valuable resources where sunkcosts must be written off,” said Larisa Ruoff, Director of ShareholderAdvocacy for Green Century CapitalManagement (Green Century). “Right now, companies are not providinginvestors, or the communities in which the companies operate, sufficientinformation on the steps they are taking to address and mitigate the risksassociated with hydraulic fracturing operations so shareholders are demandingincreased transparency.”   This year, shareholders have filed resolutions with ten companies,including Exxon Mobil, Chevron and Chesapeake Energy* calling on the companiesto provide a detailed account of how they are addressing the risks associatedwith community concerns, regulatory impacts, tightened regulations, andmoratoria.    “This year’s effort builds on the remarkable successachieved by investors last year, when similar proposals received an average 40percent** vote.  These high votes send strong messages to companies thatsignificant portions of their shareholders require increased disclosure on thisissue,” said Richard Liroff, Executive Director of the Investor Environmental Health Network(IEHN).  IEHN and Green Century coordinate investors’ engagements withcompanies on fracking.    These resolutions are part of a broader investor initiative challengingcompanies to address climate and sustainability risks.  Thus far in the2012 proxy season, investors working with Ceres, a coalition of investors andpublic interest groups working with companies to address sustainabilitychallenges, have filed 86 resolutions with 69 companies.   “Investors are concerned about the financial risks associatedwith the environmental, health, and social impacts of fracking,” saidMichael Passoff, Senior Strategist for As You Sow, which has filed atExxonMobil and Ultra Petroleum* since 2010.  “Concern about watersources, toxic chemicals, and wastewater has led to new regulations in severalstates and proposed federal legislation. Explosions, contamination incidents, and millions ofdollars in fines demonstrate that things can and do go wrong,” hecontinued.   This season, shareholders have a new tool in theirdialogue with companies.  In December, IEHN and the Interfaith Centeron Corporate Responsibility (ICCR) released “Extracting the Facts: An Investor Guide to DisclosingRisks from Hydraulic Fracturing Operations,” which isintended to help increase disclosure and mitigate the impacts of fracking.    “In order to maintain their social license tooperate, companies must fully disclose the steps they are taking to minimizerisks, to acknowledge their challenges and failures, and to clearly define themethods they will use to continually improve operations,” said LauraBerry, Executive Director of ICCR.  “The Guide offers a road map forcompanies to respond to the heightened concerns around fracking, andarticulates industry best practices that will reduce the risks, andconsequently, the impacts.”     Shareholder proposals were filed at Anadarko*,Chesapeake Energy, Chevron, EOG Resources*,Exxon Mobil, Noble Energy*, Penn Virginia*, RangeResources*, Stone Energy*, and UltraPetroleum.  These proposals have been filed by the following investors and investor advisors:  As You Sow,Green Century Capital Management, Mercy Investment Program, Miller/HowardInvestments, Sisters of St. Francis of Philadelphia,and Trillium Asset Management. 
Shareholders file resolutions with Chevron*, Exxon Mobil*, and 8 other companies to spur more responsiblemanagement practices
 
Boston, MA—For a third consecutive year, concerned investors havetargeted energy exploration and production companies that rely heavily onhydraulic fracturing (fracking) and fail to disclose critical information aboutthe ways they are managing the associated risks.  
 
Public concern about the environmentaland social impacts of fracking operations are growing across the country and can have real business implications for the companies involved.
 
“Bans and moratoria are denials of companies’ sociallicense to operate and impose a wide range of costs on companies, ranging from the costs of delays to complete loss of access to valuable resources where sunkcosts must be written off,” said Larisa Ruoff, Director of ShareholderAdvocacy for Green Century CapitalManagement (Green Century). “Right now, companies are not providinginvestors, or the communities in which the companies operate, sufficientinformation on the steps they are taking to address and mitigate the risksassociated with hydraulic fracturing operations so shareholders are demandingincreased transparency.”
 
This year, shareholders have filed resolutions with ten companies,including Exxon Mobil, Chevron and Chesapeake Energy* calling on the companiesto provide a detailed account of how they are addressing the risks associated with community concerns, regulatory impacts, tightened regulations, and moratoria. 
 
“This year’s effort builds on the remarkable success achieved by investors last year, when similar proposals received an average 40 percent** vote.  These high votes send strong messages to companies that significant portions of their shareholders require increased disclosure on this issue,” said Richard Liroff, Executive Director of the Investor Environmental Health Network (IEHN).  IEHN and Green Century coordinate investors’ engagements with companies on fracking. 
 
These resolutions are part of a broader investor initiative challenging companies to address climate and sustainability risks.  Thus far in the 2012 proxy season, investors working with Ceres, a coalition of investors and public interest groups working with companies to address sustainability challenges, have filed 86 resolutions with 69 companies.
 
“Investors are concerned about the financial risks associatedwith the environmental, health, and social impacts of fracking,” said Michael Passoff, Senior Strategist for As You Sow, which has filed at ExxonMobil and Ultra Petroleum* since 2010.  “Concern about watersources, toxic chemicals, and wastewater has led to new regulations in several states and proposed federal legislation. Explosions, contamination incidents, and millions of dollars in fines demonstrate that things can and do go wrong,” he continued.
 
This season, shareholders have a new tool in their dialogue with companies.  In December, IEHN and the Interfaith Center on Corporate Responsibility (ICCR) released “Extracting the Facts: An Investor Guide to Disclosing Risks from Hydraulic Fracturing Operations,” which is intended to help increase disclosure and mitigate the impacts of fracking.
 
“In order to maintain their social license to operate, companies must fully disclose the steps they are taking to minimize risks, to acknowledge their challenges and failures, and to clearly define the methods they will use to continually improve operations,” said Laura Berry, Executive Director of ICCR.  “The Guide offers a road map for companies to respond to the heightened concerns around fracking, and articulates industry best practices that will reduce the risks, and consequently, the impacts.”  
 
Shareholder proposals were filed at Anadarko*, Chesapeake Energy, Chevron, EOG Resources*,Exxon Mobil, Noble Energy*, Penn Virginia*, RangeResources*, Stone Energy*, and UltraPetroleum.  These proposals have been filed by the following investors and investor advisors:  As You Sow, Green Century Capital Management, Mercy Investment Program, Miller/HowardInvestments, Sisters of St. Francis of Philadelphia, and Trillium Asset Management. 

Sustainability Reporting describing the company’s environmental, social and governance business practices—co-filed with Walden Asset Management

Hydraulic Fracturing: Community Impacts – Risk Assessment -- disclosure on the impacts of fracking on local community and the financial risks of these impacts. This resolution includes both environmental impacts to water quality, health impacts from exposure to water and air, and is broad enough to include social ills documented in fracking towns.

Here is a sampling of the significant press coverage after last year’s votes.

New: Political Spending Resolution – response to Citizens United ruling. Calls on corporations to review policies and oversight processes related to political spending and public policy, both direct and indirect including through trade associations, and present a summary report by September 2012.

OLD SPRING HARBOR, NY, Jan 09, 2012 (MARKETWIRE via COMTEX) -- The Association of BellTel Retirees ( www.BellTelRetirees.org ), representing 230,000 Verizon VZ +0.02% retirees and which has waged numerous shareowner proxy campaigns at the company over the last 12 years, is highly distressed by reports ("Verizon details $20 Million More in Pay," Wall Street Journal 1/5/2012) that Verizon failed to disclose to shareowners $20 million in additional compensation it paid out to former CEO Ivan Seidenberg in 2009 and 2010 alone.

The $20 million in undisclosed compensation relates to above-target payouts on Performance Stock Units (PSUs), a form of restricted stock that is the subject of a shareholder proposal that the retirees' Association received substantial support from Verizon's owners at the 2011 Annual Meeting (the same proposal has been resubmitted for the 2012 meeting).

At Verizon's Annual Meeting last May, Association President Bill Jones stated that the performance hurdle associated with these PSUs does not align with stockholder interests since "senior executives would receive 100% of the target PSU award for median performance" compared to a peer group of companies selected by Verizon's Board.

Included among the many shareowners are tens-of-thousands of retirees who purchased stock in our company over decades-long careers and since entering retirement. We entrusted the company with a fiduciary responsibility to provide a high level of transparency to all of the public owners of its stock.

Since beginning our proxy efforts a dozen years ago, we have found it necessary to pursue changes to corporate governance to rein in Verizon Executive Golden Parachutes, overuse of Shadow Profits from the pension fund, excessive Performance Stock Unit levels to award bonuses to senior executives and the need to seek a Truly Independent Verizon board of directors free of members with clear conflicts of interest. In total retiree proxy efforts have led to ten corporate governance changes to better protect the rights of shareowners.

Retirees make up the largest block of non-institutional share holders in Verizon and, as owners, we must all be vigilant to protect our rights. The Association has consistently campaigned against Verizon's liberal policy of granting stock bonuses for sub-standard results to senior executives.

Among our results in the proxy, in 2007 ABTR successfully spearheaded the passage of Say on Pay proxy at Verizon. At the time Verizon became the largest publicly traded company to enact such a measure.

October 26, 2011

NEW YORK – Shareholders of AT&T Inc. have filed a proposal calling for the company “to publicly commit to operate its wireless broadband network consistent with network neutrality principles” that would maintain open access to the Internet on wireless networks.

The filing comes only weeks before implementation of new Federal Communications Commission rules on network neutrality that provide a broad exemption for wireless broadband networks – the fastest growing segment of the Internet.

AT&T has sought in the past to block shareholders from voting on network neutrality issues. A similar shareholder proposal on wireless networks was excluded from AT&T’s 2011 proxy ballot following a Securities and Exchange Commission staff ruling that net neutrality was not a “significant public policy issue.”

The latest AT&T proposal has been filed by institutional investors including the Nathan Cummings Foundation as well as individual investors including Mike D of the Beastie Boys. Unless the proposal is blocked again, it’s expected to be voted on at the company’s annual meeting in April 2012.

“Net neutrality is clearly a material issue of import for AT&T and for the whole country, which is why it’s critical that shareholders be heard,” said Farnum Brown, Chief Investment Strategist for Trillium Asset Management, LLC, an independent investment firm with more than $900 million under management, which represents some of the filers.

According to Laura Campos, director of shareholder activities at the Nathan Cummings Foundation, “This issue has important implications for both social and economic justice and long-term shareholder value. As a shareholder, the Foundation is concerned that over the longer-term, a failure to operate its wireless broadband network in accordance with the principles of network neutrality could negatively impact AT&T’s market share and damage its reputation with consumers.”

The AT&T shareholder proposal cites research by the Institute for Policy Integrity at New York University which concluded that an open Internet accounts for billions of dollars of economic value for Americans.”This economic and social value is an important factor in the growth of our economy and widely diversified investment portfolios,” the proposal states.

The proposal also notes that open Internet policies on wireless networks have particular importance for minority and economically disadvantaged communities. People of color access the Internet via cell phones at a much greater rate than their white counterparts, according to a report by the Pew Internet & American Life Project. “The digital freedoms at stake are a 21st century civil rights issue,” says Colorofchange.org, an organization representing African-Americans, which is cited by the shareholders.

The shareholder proposal calls on AT&T to proactively ensure that its wireless networks remain open and provide equal access and non-discriminatory treatment for all content.“

Maintaining the existing system of net neutrality for our mobile networks is a win-win – its good for economic growth and good for the principles of free expression that underpin our democracy – the greatest platform the world has known for sustainable economic growth,” said Jonas Kron, Deputy Director for Shareholder Advocacy at Trillium.

The shareholder initiative at AT&T was organized by Open MIC – the Open Media and Information Companies Initiative – a nonprofit organization that seeks to inform corporations’ responsible media management practices. “Net neutrality is necessary to insure competition, entrepreneurship, innovation, and free expression in the digital economy,” said Michael Connor, Open MIC’s Executive Director. “That’s why it is so important that the investor voice be heard.”

The complete text of the AT&T wireless network neutrality proposal is available on the Open MIC web site and can be downloaded here (PDF).

For more information about recent net neutrality issues, visit www.openmic.org.

The Open Media and Information Companies Initiative – Open MIC – is a non-profit organization working to promote a vibrant, diverse media ecosystem through market-based solutions. Founded in late 2006, Open MIC is a project of the Tides Center, a 501(c)(3) non-profit organization.

For more information, contact:Michael ConnorExecutive Director212-537-9401mconnor@openmic.orgwww.openmic.org

September 2, 2011

Increasingly investors have been evaluating the role ofcompanies as they seek to influence legislation, regulation and the publicpolicy debate.

Obviously one way for a company to be an active advocate,especially post the Supreme Court CitizensUnited decision, is to use corporate funds or their PACs to providefunds to affect elections director or indirectly.

Yet companies also work to influence public policy bylobbying directly as well as through trade associations and other third partyorganizations.  And some companies also actively co-ordinate“grassroots lobbying” whereby they reach out to employees and othersupportive groups around the country urging them to write their local Membersof Congress so they can hear from local constituents directly and not from acompany’s Public Affairs office in another state.

For example, when the McConnell Bill was presented to limitthe role of the EPA in addressing Greenhouse Gases related to Climate Change,one oil company sent an email alert to all employees urging them to contacttheir Senator / Representative to support this amendment which constituted afrontal attack on the EPA.

This powerful but indirect grassroots lobbying is much likethe U.S. Chamber of Commerce which sends out regular alerts to its membersurging them to contact their representatives.

Federal Law requires that a company’s federal directlobbying expenditures are publicly disclosed (see sample set of companyprofiles covering two years of expenditures), but indirect expenditures throughthird party and grassroots lobbying are not.  And only 21 states requireany disclosure regarding lobbying of state legislators. In addition, investorsdo not have easy access to this information unless a company adds it to theirwebsite so it is really not directly available.

Thus it is appropriate and timely to ask companies to reporton their lobbying policies, oversight and expenditures just like we seektransparency on political spending.

And some companies do a pretty good job of disclosing suchinformation on their website.

Last year AFSCME took an important step in addressing thisissue by filing resolutions seeking disclosure of lobbying with companies. Theresolution passed muster at the Securities and Exchange Commission (SEC).Formerly, lobbying resolutions had been considered “OrdinaryBusiness” and omitted by the SEC.

Now we know that such a request can properly be presented toa company for inclusion in their proxy for a vote.

I believe that proposing lobbying disclosure for a companyis separate but closely connected to our requests for full transparency onpolitical spending.  However, even though connected, I also believe it iswise to keep the two requests separate and not muddy the waters by combiningthem in one resolution.

I enclose a sample resolution which I have drafted seekinglobbying disclosure.  We also enclose a series of charts on samplecompanies lobbying expenditures we researched.

Note that the resolution seeks more clarity and furtherdisclosure than what is disclosed on the Government website.

I look forward to conversations about your interest in suchan approach as well as companies and industries where such a request should bea priority.

Timothy Smith

Senior Vice President

Director of ESG Shareowner Engagement

Request for Disclosure of Lobbying Policies and Practices

Whereas, businesses, like individuals, have a right to express opinions to legislators and regulators on public policy matters.

However, we believe it is important that our company’s lobbying positions, as well as processes to influence public policy, are transparent.  Public opinion is skeptical of corporate influence on Congress and public policy and questionable lobbying activity may pose risks to our company’s reputation. For example, corporate political spending and lobbying which might harm consumers or the public. Hence, we believe full disclosure of Company’s policies, procedures and oversight mechanisms is warranted.

Resolved:

The shareholders of Company request the Board authorize the preparation of a report, updated annually, disclosing:

1. Company policy and procedures governing the lobbying of legislators and regulators, including through trade associations. The disclosure should include both direct and indirect lobbying and grassroots lobbying communications.

Payments (both direct and indirect, including payments to trade associations) used for direct lobbying as well as grassroots lobbying communications, including the amount of the payment and the recipient.

Membership in and payments to     any tax-exempt organization that writes and endorses model legislation     composed of both corporate members and state legislators.

Description of the decision-making process and oversight by the management and Board for

a.   direct and indirect lobbying contribution or expenditure;

b.   payment for grassroots lobbying expenditure.

For purposes of this proposal, a “grassroots lobbying communication” is a communication directed to the general public that (a) refers to specific legislation, (b) reflects a view on the legislation and (c) encourages the recipient of the communication to take action with respect to the legislation.

Both “direct and indirect lobbying” and “grassroots lobbying communications” include efforts at the local, state and federal levels.

The report shall be presented to the Audit Committee of the Board or other relevant oversight committees of the Board and posted on the company’s website. 

Supporting Statement

As shareholders, we encourage transparency and accountability on the use of staff time and corporate funds to influence legislation and regulation both directly and indirectly as well as grassroots lobbying initiatives. We believe such disclosure is in shareholder best interests. Absent a system of accountability, company assets could be used for policy objectives contrary to a company’s long-term interests posing risks to the company and shareholders.

For example, a company may lobby directly or through a trade association to weaken the Foreign Corrupt Practices Act, or stop the EPA from regulating climate change or trying to limit the Consumer Finance Protection Bureau.

Company funds of approximately $XXXX million from July 1, 2010 to June 30, 2011 supported direct federal lobbying activities, according to disclosure reports.  (U.S. Senate Office of Public Records http://www.senate.gov/pagelayout/legislative/one_item_and_teasers/opr.htm)  This figure may not include grassroots lobbying, to directly influence legislation by mobilizing public support or opposition. Also, not all states require disclosure of lobbying expenditures to influence legislation or regulation.

We encourage our Board to require comprehensive disclosure related to direct, indirect and grassroots lobbying.