MMA, along with the Basilian Fathers of Toronto, has co-filed a resolution at ConAgra on the issue of its food supply chain security and sustainability. ConAgra is a leading food processor and the owner of many branded food items such as Healthy Choice, Banquet, Blue Bonnet, and Swiss Miss.

The resolution requests that ConAgra’s Board of Directors report to shareholders within six months the measures they have taken to ensure the long-term sustainability of the company’s supply chain. In the last few years, many issues have surfaced regarding the safety of the global food supply, including outbreaks of e-coli bacteria in spinach and frozen hamburger in the US and poisoned pet food and seafood from China. Other challenges for the food industry include the competing use of food crops for bio-fuels, severe droughts and water scarcity in key farming regions, and rising prices for fossil fuel inputs.

Unlike many companies that have begun working collaboratively with MMA and other shareholders to address some of these concerns, ConAgra has not yet communicated their thoughts on these issues or shown a willingness to converse with shareholders about them. We hope to initiate a dialogue by filing this resolution.

Spring is a time when many corporations hold their annual meetings. These meetings usually include voting on proposals submitted by management and shareholders. One privilege of owning shares of common stock is the right to vote, and MMA takes this privilege and responsibility seriously. MMA votes proxies strongly in favor of progressive social and environmental shareholder resolutions at company meetings. But how effective are these resolutions in bringing about change?

Here is an article about a study that sought to answer that question. Shareholder resolutions are non-binding, but management and directors sometimes adopt them. According to the study, implementation of shareholder proposals has nearly doubled in the recent past, from 22% in ‘97-’02 to over 40% in the ‘03-’04 proxy season. The percentage of shareholder support, size of the institution(s) sponsoring the proposal, and the reaction of peer firms to like-proposals are the biggest determinants on how the company will react.

Many recent resolutions in the realm of corporate governance - including the topics of executive compensation and separation of combined CEO and Board Chair positions - have garnered high support among shareholders and led to implementation. Social and environmental resolutions have also tasted increasing success, though less definitively. As more large institutional investors such as pension funds lend their support to more socially-oriented resolutions, these proposals will likely become more effective tool for changing corporate policy.