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By Sister Marilín Llanes, OP
Portfolio Manager of Community Impact Investments,
Portfolio Advisory Board
Imagine this situation: Mariela, 41, a Latina with limited resources living with an adult child scrambling to pay legal expenses for a divorce. Where will she go for help to get a small consumer loan in the big metro city of Miami, Florida? During this difficult time for Mariela, she turned to Capital Good Fund for a $3,500 Impact PLUS Fund instead of going with payday lenders that take advantage of people in such dire situations.
“Capital Good Fund made me feel supported, empowered, and confident,” she said. “Capital Good Fund offered options and solutions instead of creating problems. The tools are there. There are people willing to help you.”
The Adrian Dominican Sisters Portfolio Advisory Board (PAB) welcomed in March 2023 Capital Good Fund as new partner borrower. Andy Posner, Founder and CEO launched the nonprofit certified Community Development Financial Institution (CDFI) in 2009 with a mission to create pathways out of poverty and advance a green economy through inclusive financial services. It grants loans nationally – in Rhode Island, Florida, Massachusetts, Delaware, Illinois, Texas, Colorado, New Jersey, and Connecticut – and is incorporated in Providence, Rhode Island.
The PAB is especially pleased to partner with Capital Good for its commitment to address racial equity and its recognition that racism, discrimination, poverty, and financial exclusion are all linked.
Capital Good Fund’s mission is well aligned with the Congregation’s 2022 Enactment on Diversity, which calls the Adrian Dominican Sisters to “build the beloved community in which everyone is cared for, absent of poverty, hunger and hate.”
Capital Good engages daily with underserved families and provides tools for savings, building credit, investing in themselves, and avoiding high-interest debt to be able to reach their goals.
All loans are offered through a financial technology (fintech) platform. Fintech transactions are efficient, reliable, and easily accessible to the client who is often living with time and energy constraints, and limited resources. The array of products Capital Good offers range from car loans, immigration loans to cover cost like green card acquisition and citizenship; consumer loans, weatherization loans to make homes more efficient and emergency loans for unexpected expenses like in Mariela’s story.
Ana came to the United States with a dream: to start her own business, buy a house, and create a better life for her children. But she had a problem: she needed $5,000 to get her work permit. That's where Good Fund came in. By providing the loan, Capital Good enabled Ana to get a work permit and launch her business. This opportunity for Ana boosted her credit score, allowing her eventually to buy her own home for her husband and two children. Watch Ana tell her story here.
Mariela and Ana are two of the thousands of individuals and families serviced by the Capital Good Fund team.
Learn more about Capital Good Fund at https://capitalgoodfund.org/en/.
By Dee Ann Joyner, Associate
Director of Portfolio Advisory Board
The Portfolio Advisory Board (PAB) held its spring meeting March 23-24, 2023, at Weber Retreat and Conference Center. The first day was devoted to business items, shareholder advocacy, and community impact investing. The second day focused on strategic planning. PAB member Joe Barker opened the meeting each day with a beautiful reflection and prayer.
The following are highlights from the meeting.
Following a presentation on community investing trends by Charlene Van Dijk, Senior Advisor for Community and Economic Development for the Federal Reserve Bank of Atlanta, Sister Marilín Llanes, OP, Portfolio Manager, presented an update on the PAB community impact loan portfolio. She then presented five loans for renewal and two new loans for approval.
The PAB approved the following loans for renewal:
New loans were approved for the following borrowing partners:
Pat Zerega, PAB consultant with Mercy Investment Services, and Judy Byron, OP, PAB consultant with the Northwest Coalition for Responsible Investing, presented a report on their activities for the 2023 proxy year. They have engaged with 34 companies on 66 topics in three major areas of focus: protection of human rights, healthy persons and communities, and environmental sustainability.
In addition, they filed 17 shareholder resolutions, 13 of which were accompanied by some form of dialogue with the companies. One of the resolutions (with Johnson & Johnson) was withdrawn when the company agreed to support the shareholder request for a third-party audit of the racial impact of its policies, practices, and products. The Adrian Dominican Sisters supported signing on to 24 letters, joining other faith-based investors in expressing viewpoints on actions of various companies at odds with our social impact criteria.
Following the mid-year report, Pat and Sister Judy were joined by Mary Minnette of Mercy Investment Services and shared their observations on trends in shareholder advocacy to inform further discussion by the PAB as part of its strategic planning process.
Cynthia Crim, center, Chair of the Portfolio Advisory Board (PAB), stands with Corinne Florek, OP, left, and Judy Byron, OP, as the PAB thanks them for their service.
The PAB and members of the General Council expressed gratitude to Sister Corinne and Sister Judy upon their retirements for their many contributions to PAB. Sister Corinne retired effective June 30, 2022, as portfolio manager, and Sister Judy will retire as shareholder advocacy consultant on June 30, 2023. Contributions were made to the Opportunity Resource Fund and to the Intercommunity Peace and Justice Council respectively in honor of Sisters Corinne and Judy.
Cynthia Crim, PAB Chair, thanked the retirees on behalf of the PAB and Corinne Sanders, OP, General Council Liaison and voting member of PAB, led a toast before members of PAB shared stories and appreciation.
Day two of the PAB meeting was devoted to engaging the board in a discussion of a proposed strategic planning process recommended by its Strategic Planning Committee. Cynthia and Sister Marilín began the day by leading a discussion of the book The Sum of Us by Heather McGhee. Members of the board had been asked to read the first three chapters of the book, which introduces the premise that racist policies impact everyone, not just those persons they are designed to hurt.
Following a discussion of how this impacts the work of PAB, the board spent the rest of the day discussing a logic model, the Theory of Change, as a framework for strategic planning. The discussion was led by PAB member Carla Mannings and Sister Marilín.
After an explanation of the Theory of Change Model, Carla and Marilín presented proposed vision and mission statements recommended by the Strategic Planning Committee. The board adopted the following to guide its work:
PAB Vision: Rooted in the vision, mission, and enactments of the Adrian Dominican Sisters, the Portfolio Advisory Board envisions a beloved community without poverty, hunger, homelessness, and ecological degradation. The beloved community is shaped by its collective voices and is committed to promoting racial and gender equity and systemic changes to policies and practices of institutions inhibiting its realization. Building on its collaborative strength, the beloved community is an active, healthy, and thriving space where all are welcome and have a voice.
PAB Mission: The mission of PAB is to use the assets of the Adrian Dominican Sisters to build the beloved community. We invest in community organizations that create opportunities for those who are marginalized and that embody values of collaboration, inclusiveness, right relationship with Earth, and racial and gender equity. We use our voice as shareholders in corporations to promote policies and practices that build the beloved community.
The board then reviewed the outputs from the PAB September meeting discussion of the Enactments and agreed upon four overarching themes for the strategic plan:
• Shareholder Advocacy
• Community Impact Investing
• Alignment of the Work of PAB for Greater Impact
• Collaboration with Internal and External Partners
A fifth area, Sustainability, will be integrated with the Shareholder Advocacy and Community Impact Investing themes.
The board began work on developing impact statements for the four themes and affirmed continuing to use the Theory of Change framework for its planning process. The Strategic Planning Committee will take the work of the board back to further develop each theme and return with recommendations for the board to consider in September.
The meeting ended with honorable closure. Please see the PAB website for monthly articles on our borrowing partners and shareholder advocacy activities.
Feature Photo at top: Attending the Portfolio Advisory Board Spring 2023 meeting are: standing, from left, Joseph Barker II; Associate Dee Ann Joyner, Director; Bibiana “Bless” Colasito, OP, General Council Co-Liaison; Marilín Llanes, OP, Portfolio Manager; Kristine Cooper, Office Manager; Cynthia Crim, Chair; Pat Zerega, Consultant; Carmen Mora, Vice Chair; Mary Minnette, Consultant; Carla Mannings; Corinne Sanders, OP, General Council Co-Liaison; and Janice Brown, OP, General Councilor and former Board member. Seated or kneeling, from left, are Corinne Florek, OP, retired Consultant; Judy Byron, OP, Consultant; and Mary Priniski, OP.
Reprinted with the permission of the Latino Community Credit Union
Vicky Garcia, Senior Vice President of Latino Community Credit Union (LCCU) – a community investment of the Adrian Dominican Sisters – participated in a late January 2023, moderated conversation with Vice President Kamala Harris and Isabella Guzman, U.S. Small Business Administrator. The conversation was introduced by Marla Bilonick, President and CEO of the National Association for Latino Community Asset Builders (NALCAB) and moderated by Jorge Buzos of Univision.
Marla framed the conversation perfectly, explaining the important relationship between small, Latino-owned businesses and the community lenders that are “entrenched in the communities they serve … and fill an important gap by providing loans and financial services that traditional banks are sometimes not able or willing to provide.” She concluded by celebrating LCCU as a “superstar in the community lending field.”
Vice President Harris said community lenders like LCCU “understand the capacity of the community. They understand the culture of the community, the mores of the community, what the community wants for itself.” These words beautifully describe LCCU, which has established a national model for financial inclusion and has provided $1.6 billion in loans to Latinos traditionally marginalized from economic opportunity.
“Vice President Harris is a proven champion of community lenders, including credit unions like LCCU,” Vicky said. “By taking the time to come here and meet our members face to face, the Vice President is recognizing their important contribution to the U.S. economy and LCCU’s role as a driver of economic opportunity and growth.”
Vice President Harris met several LCCU members who have used LCCU loans to start and grow their businesses, buy homes, and build generational wealth. Additionally, she and Administrator Guzman visited a local bakery owned by LCCU members.
Vice President Kamala Harris visits a bakery owned by members of the Latino Community Credit Union. (Photo courtesy of the Latino Community Credit Union)
The vice president was also on hand to celebrate the federal government’s investment in community lenders like LCCU. As part of the U.S. Treasury Department $9 billion Emergency Capital Investment Program (ECIP), LCCU received a $99 million, 30-year, low-interest loan from the U.S. Treasury Department.
The federal investment provides LCCU the equity to build its capital base dramatically and quickly expand its impactful, public-private partnership model. LCCU is now positioned to raise significantly more deposits from mission-aligned private sector partners – corporations, foundations, and health systems – and immediately deploy those deposits as life-changing loans to those who need them the most.
Over the 30-year term, LCCU expects to raise $700 million in private sector deposits, which in combination with member deposits, will allow for the union to make one million fair and affordable loans, for a total of $30 billion in financing, to its growing membership of Latinos in the Southeast.
Vice President Harris concluded by underscoring that LCCU’s “one million loans will have a profound exponential impact on the economic health and wellbeing of the community.”
Watch a video of the event below or on YouTube.
By Sister Marilín Llanes, OP
Portfolio Manager of PAB Community Impact Investments
The Ecumenical Church Loan Fund (ECLOF) International is a Swiss non-profit microfinance institution with a mission-driven compass, serving low-income micro entrepreneurs and farmers in 12 developing countries. Since 2018, ECLOF International has been a loan recipient of the Adrian Dominican Sisters’ Portfolio Advisory Board (PAB) community impact Investment initiative.
The ECLOF International Hub is committed to empowering low-income people to create, manage, and own their own businesses, especially with a focus on gender inclusion and equality. Two stories featured in this article are prime examples of ECLOF’s engagement.
- Article courtesy of the ECLOF Dominica website
In the Dominican Republic near the Santo Domingo area, ECLOF Dominica serves mainly women engaging in urban and rural businesses. Besides loans, ECLOF Dominica provides business education and financial literacy training to its clients.
In the community of El Toro de Guerra, at the periphery of Santo Domingo, 28-year-old Lidia de la Cruz runs “Escuelita Arco Iris” (Rainbow School) for children in the community who need help with homework and their lessons. The children would not be able to do so at home due to their family’s lack of time or knowledge to assist them. Lidia welcomes 25 to 30 children ages 4 to 11 every day.
With consecutive loans from ECLOF Dominica over the last four years, Lidia has set up a small classroom with basic equipment: a few desks and chairs. Beyond school knowledge, Lidia teaches children social values and how to interact with each other. She motivates them and accompanies them in their self-development.
Characterized by perseverance and a desire to serve her community, Lidia has been supporting children since the age of 12. Although she never attended college, she took her knowledge from school and continued learning on her own without the benefit of formal education. Lidia wishes eventually to go to university to improve the quality of her teaching to her young pupils and her own children in the future.
Lidia won second place as Educational Microenterprise of the Year in the CITI Micro Business Award 2013 sponsored by Citibank. More importantly, the people of El Toro de Guerra describe Lidia as playing the role of the sun that hits the rain to brighten the lives of her small neighbors with a beautiful rainbow every day.
- Article courtesy of the ECLOF Philippines website
Victor, 38, is a proud farmer and role model for the next generation of farmers on the Filipino island of Palawan. It wasn’t always easy for him. As a teenager, he steered clear of farming and instead trained as a mechanical engineer. But when his father passed away in 2014, Victor decided to give farming a try on the family’s 1.7 hectares (4.2 acres) of land.
Victor started attending specialized agricultural training sessions and events organized by ECLOF Philippines. He was also invited to showcase his work and represent his hometown in Manila. Next, he took a big leap to apply for first loan of $220 to develop his farm, despite initial reservation against borrowing money.
In the following seven years, he diversified his father’s monoculture rice field into a mixed field for livestock, fruit, and vegetables. This model proved so successful that Victor turned it into a training center for other farmers that is accredited by the Technical Education and Skills Development Authority (TESDA). In April 2022, it was awarded as a learning site for capacity building of the farmers in their communities.
The entrepreneurial stories of Lidia and Victor offer hope and opportunity for the present and future generations of business seekers in the Dominican Republic and Philippines.
Feature photo at top: A woman from Santo Domingo in the Dominican Republic seated at a table writing
By Sister Judy Byron, OP Consultant, Portfolio Advisory Board
The 2023 shareholder engagements of the Portfolio Advisory Board (PAB) of the Adrian Dominican Sisters will carry out the Enactments of our 19th General Chapter, held in June 2022. In addition to electing our new leadership, more than 200 Sisters of the Congregation affirmed our focus for the next six years on areas including diversity, sustainability, and women.
In our 2023 Shareholder Advocacy Plan, the PAB committed to raise up systemic inequities and the quest for racial justice in corporate board rooms, where we will advocate for policies and practices which respect human rights and promote worker justice, food justice, health equity, and a transition to a low-carbon future.
Focusing on our Adrian Dominican Enactment on Diversity to “act to dismantle unjust systems; and build the beloved community in which everyone is cared for, absent of poverty, hunger, and hate,” we engage Walmart and Dine Brands (Applebee’s and IHOP) on providing adequate wages and benefits for their employees. Research by the Institute for Child, Youth and Family Policy at Brandeis University found that more than one-third of U.S. families that work full-time year-round do not earn enough to cover a basic family budget. More than half of Black and Hispanic families cannot afford basic needs.
We plan to continue addressing information and communications technology companies, Alphabet and Meta Platforms (Facebook), on child sexual exploitation online. In 2021 the National Center for Missing and Exploited Children’s Cyber Tipline received 29.3 million reports of suspected child sex abuse materials online. Some 92.2% of the reports involved Meta mobile apps Facebook, WhatsApp, and Instagram.
In support of the human right to health and the dignity of each person, we ask pharmaceutical companies to adopt a human rights policy which includes the right to the highest standard of health for all with a focus on women, Indigenous Peoples, and those living in poverty and to develop drug pricing strategies that support affordability and access for all. Companies that we engage include Eli Lilly, Gilead Sciences, Johnson and Johnson, and Pfizer.
Acting on our Sustainability Enactment “to address the cry of Earth and the cry of those who are poor,” we engage companies to assess the impact of their operations on society, the local economy, and the environment. We especially focus on the most vulnerable, including women, Indigenous Peoples, communities of color, and people who are impoverished.
We ask fossil fuel companies to adopt technologies to monitor and reduce methane emissions. The Environmental Defense Fund says that “cutting methane emissions is the fastest opportunity we have to immediately slow the rate of global warming, even as we decarbonize our energy systems.” In addition we ask fossil fuel companies to improve their public disclosure and transparency reporting, including plans to comply with a regulatory scenario that holds global temperature rise below a 1.5 degrees Celsius threshold. Companies in this sector include Exxon Mobil and Marathon Petroleum.
The PAB is a member of the Interfaith Center on Corporate Responsibility (ICCR), which pioneered the use of shareholder advocacy more than 50 years ago. “Inspired by faith, committed to action” to build a more just and sustainable world, ICCR members in the 2022 proxy season engaged hundreds of companies with thousands of dialogues and with more than 500 shareholder resolutions. We reached agreements with companies to implement the resolution requests for 174 proposals; the majority focused on climate issues and racial justice.
By Marilín Llanes, OP, Portfolio Manager Community Impact Investments
In 2020, the idea of the Emergency Relief Loan Fund emerged during a Portfolio Advisory Board (PAB) meeting rising from a deep sense of “what more can we do” during the two colossal pandemics. The looming effects and complexities of COVID-19 and the rise of racially based deaths weighed heavy in our hearts. It was an urgent call to respond to the great economic challenges facing our country and world. The moment to invest for change and restore hope was realized in the selection of four financially struggling communities in or near areas of Chicago, Seattle, Detroit, and Oakland impacted by these extraordinary events.
This engagement was well aligned with Congregation’s 2016 Enactment on Race, Violence, and Diversity, beckoning us to “pledge our lives, money and other resources to facilitate and create” opportunities with people “relegated to the margins.” A proposal was drafted and presented to the Adrian Dominican Sisters General Council. Swiftly it was approved to create a $1 million Emergency Relief Loan Fund with zero interest to be disbursed into four equal parts among the four selected Community Development Financial Institutions (CDFIs) for three- to five-year terms.
The criteria for disbursal of funds by CDFIs was determined by PAB members was two-fold: relief to people of color who were unable to make mortgage payments and support for rebuilding small business owners in impacted communities of color.
Two years later, the four CDFIs are sharing stories of resilient people who have benefitted from the loans.
Ventures is a Seattle-based nonprofit that empowers aspiring entrepreneurs with “limited resources and unlimited potential” with 100% focus on BIPOC (Black, Indigenous, People of Color), women, immigrants, LGBTQ, and individuals with low income.
The featured story is about Once Upon a Time Early Childhood Family Daycare, a bilingual school located in Burien, Washington, that provides activities to reinforce children’s learning. It is unique in that there are not a lot of bilingual programs in the area that offer both full-time and part-time care. Owner Diana Llanes (no relation to Sister Marilín), is a certified teacher in early childhood education and for more than 11 years has taught social, emotional, and behavioral skills and promoting an environment of learning and curiosity.
Allies for Community Business (A4CB), located in East Garfield Park on the West Side of Chicago, is a nonprofit that helps neighborhood entrepreneurs. With the Emergency Relief Funds, A4CB provided small business loans to assist minority and women business owners who experienced financial hardship due to unprecedented times.
Since the inception of the loan, A4CB team has dispersed 19 loans in the neighborhoods of Bridgeport, Brighton Park, McKinley Park, and New City. According to Mary Tristis, Director of Community Lending, business owners who benefited from loan funds have been women-owners (nine), African American owners (six), Latinx owners (six), and Asian American owners (two).
A loan recipient of A4CB, Jeff Yumul and spouse Deanna Spear-Yumul followed their dreams and founded Bjjxyoga Studio in the McKinley Park neighborhood. The studio specializes in Brazilian Jiu Jitsu and mixed level yoga for all ages.
Bijjxyoga Studio, McKinley Park, Illinois.
Photo courtesy of business.
Like many businesses, the studio was forced to close temporarily due to the pandemic. After reopening, Jeff found that customers were apprehensive to attend in-person group classes, further delaying the studio’s return to pre-pandemic operating levels.
In early 2022, Jeff received an A4CB small business loan to help his business grow. “We used the funds to expand our location by double the square footage,” Jeff said. “More space means more customers we can inspire!” (Article courtesy of the A4CB website in celebration of Asian American /Pacific Islander heritage month, May 23, 2022).
Working Solutions CDFI was founded in Oakland, California. Since October 2020 it has made 10 loans totaling $250,000 with Adrian Dominican Sisters’ community investment capital to entrepreneurs in Almeda County (specifically in Oakland, Emeryville, San Leandro, Hayward, and Fremont), with 100% deployed to low-income individuals, 89% to women, 96% entrepreneurs of color.
A. Romo’s Café, a Latinx-owned, woman-owned coffee shop, received the first loan from Working Solutions in 2020, to support the transition to take-out orders at the start of the COVID-19 pandemic. Today, Romo’s Café is thriving and has a five-star rating on both Yelp and Facebook. As Working Solutions’ client, Laura Hernandez Romo, owner, has received free, personalized business consulting support on cash flow management from Business Consulting team.
The fourth CDFI recipient, Opportunity Resource Fund (OppFund) is based in Grand Rapids, Michigan. Adrian Dominican Sisters was its first investor more than 30 years ago and continues to partner in this mission-driven work.
Over the course of those two years, OppFund deployed 28 loans made in amounts ranging from $9,500 to $15,485. These affordable mortgage loans were made for a term of 60 months, and the majority, 22, were made to single female heads of household. Twenty-seven borrowers were African American, and one was a member of the Latinx community. All loan borrowers resided in Detroit. This project has been a great success and OppFund looks forward to these clients completely paying off their mortgages in the coming few years.
The Adrian Dominican Sisters Portfolio Advisory Board continues to boldly keep alive the living legacy set by our women to bravely respond in times of crisis: to show our solidarity and support in the ways we have done for more than 45 years, and to do it by investing in people’s lives, hopes, and dreams in the Spirit of the mission of Jesus.
By Kimberly Pelkofsky, Director of Design and Planning,
Thunder Valley Community Development Corporation
In 2018, Thunder Valley Community Development Corporation (TVCDC) began construction on 14 single-family homes – part of a larger goal of providing 21 homes for ownership at affordable prices to community members on the Pine Ridge Indian Reservation.
The three- and four-bedroom homes are all energy and water efficient, highly insulated to weather temperature extremes, built to withstand 120 mile per hour sustained winds, and finished with low-to-no volatile organic compound (VOC) paints, carpets, and materials. Each home also comes with a TVCDC owned and maintained solar array to help keep energy costs low, and a structurally robust carport that can withstand the frequent and severe summer hailstorms. With all of these features, these homes are a unique housing product in the Reservation.
Initially, six investment partners, including the Adrian Dominican Sisters, were identified to fund the construction of 11 homes. Each investment partner contributed capital by way of a construction loan to a specific lot or lots.
The Adrian Dominican Sisters were introduced to TVCDC through Nick Tilsen, a featured speaker at the Congregation’s 2018 Resilient Communities Symposium at Weber Retreat and Conference Center in Adrian in March. Nick, a citizen of the Oglala Lakota Nation, was then Executive Director of the TVCDC.
Although construction began with a great deal of momentum, it was not too long before challenges surfaced. Costs were rising far beyond original estimates and at a rate faster than TVCDC could find additional funding to cover the difference. Workforce challenges with consistency and workmanship meant that progress was slow. Construction was put on pause. A dramatic shift in approach was needed.
The idea of an Intercreditor Agreement was proposed during one of our investor calls. To put it simply, rather than having six investors operating independently of each other to complete a specific home, all investors would collectively work together to complete the 11 homes. This consolidated the financial structure of the project; set a cap on loan interest rates; and extended the repayment term, which had previously varied by investor.
Sales proceeds are now first returned to TVCDC to cover ongoing construction costs and are repaid in a rolling fashion by proportion of principal investment as homes are completed and sold. This streamlined process gives TVCDC additional time to complete the project, source additional funding, and reduce reporting burdens.
Although the break in construction could have been seen as a detriment to the project, the additional time gave the organization the opportunity to continue to work with potential homeowners to ensure they were on solid footing before a purchase.
Since executing the Intercreditor Agreement, TVCDC has restarted construction and completed four homes. To date, two of these homes were sold in 2022. The first, a three-bedroom, closed in April and the second, a four-bedroom, was closed in mid-August.
The four-bedroom home – the lot that the Adrian Dominican Sisters originally contributed to – was sold at $200,000. It is now owned by a woman and is the residence of the community member, Lakȟóta spiritual leader, and TVCDC founding member who led the Inípi Ceremony that brought forth the idea to create TVCDC all those years ago.
The Forum for Sustainable and Responsible Investment Foundation reports that faith-based and healthcare organizations represent 4% of assets at major companies, yet they file 36% of resolutions, making them a powerful voice at corporations around the world.
For decades, the Adrian Dominican Congregation, through the Portfolio Advisory Board (PAB), has been part of this work: filing resolutions, engaging companies, and speaking to corporate boards at their annual meetings. This work has been done in coalition with other faith-based shareholders from the Interfaith Center on Corporate Responsibility (ICCR), where members often pool their holdings to have a seat at the table.
This longtime work has resulted in hundreds of examples of companies changing their policies and practices after constructive engagement with shareholders. ICCR members have championed positive changes in areas such as annual director elections, supply chain risk and impact reporting, political and lobbying spending disclosure, climate risk reports, and due diligence practices for human rights risks.
In 2020, the Securities and Exchange Commission (SEC) enacted new rules that severely restrict small shareholders in the resolution process. In the past, shareholders could pool their ownings to reach the $2,000 worth of stock that needed to be owned for one year in order to file a resolution.
The new rule bars shareholders from pooling stocks, and an individual organization must own at least $2,000 of the company’s securities for at least three years. The new rules offer no provisions for shorter ownership, such as owning at least $25,000 for at least one year to file a resolution.
The SEC also changed the minimum vote to return a resolution the following year. A first-year resolution must now get 6% vote support, up from 3%. By the third year, a resolution must receive 25% vote support – a tall order for many resolutions on social issues.
In 2021, ICCR and several other investor groups entered litigation to rescind the rule changes. The PAB offered several examples of how the changes would negatively impact their work. Unfortunately, the courts have postponed the ruling several times, now indicating a decision in late November, subjecting the current shareholder filing season to the more stringent filing rules. These limitations curtail the voice of small shareholders and place additional constraints on the PAB’s work for the 2023 season.
It’s important to note, the engagement process is more than just filing shareholder resolutions. The ongoing dialogues and long-term relationships that are a hallmark of the PAB mean that much of our work continues. Companies are aware that very often we as faith-based shareholders are like “canaries in a coal mine” or an “early warning system.” We hear the social and environmental concerns from partners and advocates on the ground and see the world with a moral lens; thus, we raise issues that may not have yet made it to the C-Suite level.
As this article is posted, the PAB is considering the 2023 shareholder season work plan, engaging to effect change toward justice in the policies and operations of corporations in which we hold investments.
Article by Pat Zerega
Portfolio Advisory Board Consultant
Mercy Investment Services
By Sister Judy Byron, OP, PAB Consultant
Just two weeks after witnessing the murder of her teacher and classmates, fourth grader Miah appeared before the House Committee on Oversight and Reform. She shared how she and her classmates were celebrating the end of the school year with a movie when a gunman burst into their lives. Miah went on to describe how she smeared herself with the blood of her friends to appear dead and used her teacher’s phone to call 911 for help. We know that her call was in vain. No one came to save the children.
For five years now, faith-based shareholders led by the Adrian Dominican Sisters and CommonSpirit Health have been calling on firearm manufacturers Smith & Wesson and Sturm Ruger to play a positive role in developing firearms and shaping legislation that would benefit their business and the health and safety of our citizens. Like Miah’s call to 911, our request has gone unanswered.
In 2018, a majority of shareholders supported our resolutions with Smith & Wesson and Sturm Ruger, requesting a report on the company’s activities related to gun safety measures and the mitigation of harm associated with gun products. The reports were disappointing in that they failed to put forward meaningful solutions to address gun violence.
For the past four years we have been calling on Smith & Wesson to adopt a policy articulating a commitment to respect human rights, which includes a description of a due diligence process to identify, assess, prevent, and mitigate actual and potential adverse human rights impacts. In 2021, 44 percent of shareholders supported the proposal. The resolution will be presented for a vote again this year at the company’s annual meeting in September.
This year, on June 1, CommonSpirit Health led a resolution, co-filed by the Adrian Dominican Sisters, urging the Sturm Ruger board to oversee a Human Rights Impact Assessment which assesses and produces recommendations for improving the human rights impacts of its policies, practices, and products. It was supported by 69 percent of the Company’s shareholders.
“This shareholder majority in favor of the proposal invites Sturm Ruger to consider what it can do to contribute to solutions to the preventable epidemic of gun violence,” said Laura Krausa of CommonSpirit Health. “We refuse to believe there is nothing we can do to reduce gun violence. We know we can find common ground on common sense approaches that respect the right to own a gun, and also the obligation to help keep our neighbors safe and healthy in the face of this epidemic of gun violence." (source)
Although the police didn’t come when Miah called for help, in the hours and days after the tragedy at Robb Elementary School, the children, families, and community of Uvalde have been held in a circle of care. This circle includes shareholders of firearm manufacturers; faith communities; citizens who demonstrated for sensible gun reform; and the U.S. Congress, which took steps to address gun violence for the first time in 30 years. Together, we will answer our children’s cry for help, their plea to be safe in their schools and communities.
The following article was written by Iroquois Regenerative Farms, Inc., an organic farmland real estate investment trust that provides organic and regenerative farmers with land security through long-term leases and mortgages. In turn, Iroquois Regenerative Farms receives a low-interest loan from the Adrian Dominican Sisters’ Portfolio Advisory Board. The article was submitted by Donna Holmes, Investment Relations, Iroquois Valley Farms.
We are excited to introduce one of the newest farms in our portfolio: Vollmar Family Farms, located in Tuscola County, Michigan. Mark and Dawn Vollmar farm 500 acres of diversified row crops in an “organic hotspot” of Michigan, surrounded by more than 10,000 acres of certified organic farmland within just a few miles of their properties. Their son, Jordan, farms with Mark, and he has expanded his own organic operation to an additional 500+ acres in the same area.
Mark is a fifth-generation farmer whose family has farmed in Tuscola County since the 19th century. This legacy includes challenges, along with a deep respect for the land and community. Mark is grateful to be farming with his son and to know that the legacy will continue. Mark's father was forced to sell much of their land and exit farming during the 1980s farming crisis.
Certifying organic in 1997, Mark rebuilt the operation to what it is today. The Vollmars are strongly committed to organic and regenerative farming practices. They are certified organic and are moving to regenerative organic certification (ROC). Their diversified crop rotation includes dry beans (pinto, navy, and black), grains (spelt, einkorn, rye, blue and yellow corn), and hemp.
Mark started farming as a teenager and decided to pursue organic farming 24 years ago to provide a better living for his family. He quickly realized that organic farming's positive effects on human health and the well-being of the environment are equally important.
Mark now seeks out regenerative, no-till farming techniques to further improve soil health and has learned from Rodale Institute and Rick Clark, a prominent no-till organic farmer from Indiana. The family uses no-till practices as much as possible, and they also embrace planting cover crops.
Feature photo at top: Mark and Dawn Vollmar at their 500-acre family farm in Tuscola County, Michigan.
Portfolio Advisory Board, Adrian Dominican Sisters | 1257 E. Siena Heights Drive | Adrian, Michigan 49221
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