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The Interfaith Center on Corporate Responsibility (ICCR) uses their position as shareholders to file shareholder resolutions and to meet with top management to press corporations to adopt socially and environmentally responsible policies and practices, including the adoption of comprehensive, transparent, verifiable human rights policies based on international human rights standards.

ICCR is a coalition of 275 religious investors from the Catholic, Jewish and Protestant communities in the United States with a combined investment total of over $110 billion.  In addition to religious members, ICCR has over 30 associate members who join in shareholder actions to promote human rights and social responsibility.  These institutions include socially responsible investment firms, public pension funds, union pension funds, foundations, human rights groups and universities.

ICCR has developed relationships with a number of local and regional groups in other countries that are campaigning for respect for human rights and labor rights.  These transnational relationships help to confront the negative affects of corporate behavior by linking NGO human rights and labor activists to shareholder activists.

A number of powerful transnational companies operating in today’s global economy have directly or indirectly committed human rights abuses in communities where they operate.  ICCR’s Human Rights Working Group focuses on ten key transnational corporations (TNCs).  One company is Alcoa Aluminum, a US-based organization operating in 41 countries.  ICCR first interacted with Alcoa in 1994, focusing on its Mexican operations because of low wages, worker rights abuses and health and safety violations.

First, ICCR members filed a shareholder resolution with Alcoa in the fall of 1995 calling on the company to address the low wages and poor working conditions in their plants.  The company called for a meeting in Cuidad Acuna, Mexico, and sent five top managers.  ICCR brought shareholders, plus 12 workers from Alcoa plants and two representatives of the Coalition for Justice in the Maquiladoras.  At the meeting, the workers presented a list of grievances.

Alcoa did not respond favorably, so the resolution went to the ballot to be voted on at the annual meeting in May 1996.  The shareholders and workers sent a letter to Alcoa’s Chief Executive Officer detailing the problems.  Before the meeting, ICCR shareholders, along with several unions sponsored a rally where two Alcoa workers from Mexico spoke.  In the shareholder meeting, the resolution was presented; ICCR members and workers spoke about the low pay, lack of sanitation, and safety issues and the Chief Executive Officer responded that these allegations were not true.  The resolution got about 8% of the vote.

The Chief Executive Officer finally agreed to meet with ICCR and the workers right after the shareholder meeting.  One of the workers told the CEO about a woman who had gotten her leg caught in some machinery at the Cuidad Acuna plant. The injury was not recorded.  The CEO promised a high level investigation in the next six weeks.

As a result of this investigation, workers’ salaries were increased by $5.30 a week, profit-sharing was paid, protective equipment for the workers was distributed, overtime was made voluntary instead of mandatory, bathrooms were reconstructed to make them more accessible to workers, a Worker Complaint Mechanism was created to communicate worker issues to management, and the head of Alcoa’s Mexico operations was fired because he did not report on a gas leak that hospitalized a number of workers.

Workers and shareholders continue to meet 2-3 times a year to focus on worker issues in Mexico, specifically on the right of the workers to form a union.  In 2001, Alcoa adopted a human rights policy that includes the right of workers to organize unions, the payment of compensation that meets or exceeds the legal minimum set by governments, respect for the cultures, customs and values of people in the communities where Alcoa operates, and the prohibition of the use of forced labor, child labor and discrimination or harassment of any kind.  While problems continue to exist in Mexican plants, there is a clear line of communication between workers, shareholders, and the top management of Alcoa.

Large transnational corporations (TNCs) are powerful institutions that do not change if only one tactic by shareholders is used.  The tactic needs to be combined with others, including lawsuits, corporate campaigns, consumer boycotts, research and reports detailing corporate behavior and government enforcement of laws. Corporate human rights policies can be adopted without changing corporate behavior, thus monitoring is essential, or else the policies could become public relation gestures.  To gain long-term change in corporate behavior, there needs to be more than voluntary adoption of human rights policies by corporations.  There needs to be enforceable mechanisms that all TNCs and other business enterprises are required to adopt and implement based on international law.

However, institutional shareholders committed to social and economic justice have, as part owners of the corporation, a foot inside the company and therefore have mechanisms of communication, they can use to raise issues and press for change.  Negative publicity and the risk to corporate image have motivated some companies to improve the labor and human rights conditions in their operations and their supply chains.  There is a growing international consensus that corporations must address their responsibilities to promote and protect human rights.  Human rights activists working on corporate accountability can develop international links to religious and socially responsible investors in other countries as allies in their struggle to stop harmful practices of transnational corporations.   

This paper was completed on June 14, 2005.

Photo credit: Fibonacci Blue