Sustainability is becoming as important an issue as Marketing or Human Resources when it comes to corporate management. In a recent report issued by the Governance & Accountability Institute 53% of the S&P 500 companies are reporting on their environmental, social and governance (ESG) impact through a public Sustainability Report.
Due to its lack of transparency on the matter, Actavis (formerly Watson Pharmaceuticals) has been approached by Sustainvest Asset Management to adopt a sustainability report through the process of shareholder advocacy. “I find it amazing in this day and age that many multi-billion dollar corporations still do not issue a sustainability report,” states Dale Wannen, President of Sustainvest Asset Management. “This is really about showing shareholders initiatives for anything from reducing greenhouse gas emissions to waste reduction targets to using recycled paper in their offices. Since Actavis doesn’t publicly show any type of report, we, as shareholders, have a right to ask them why not and use the power of the proxy to do so.”
It should be noted that within the pharmaceutical sector, many firms have taken initiative and reported on sustainability metrics. Johnson and Johnson has a Citizenship and Responsibility Report. Pfizer has a Corporate Responsibility Report. Abbott Laboratories has a Global Citizenship Report.
“We are in the year 2013, not 1985” continues Wannen. “If a corporation has yet to adopt a sustainability report, especially firms with sales exceeding $5 billion, it shows me that they are light years away from taking such an important topic seriously. Keep in mind, this document is non-binding. It’s simply a matter of taking the first step and showing investors that the executives and board have their finger on the pulse of the issue.”
Today, companies like Bloomberg and MSCI provide information on ESG performance that investors and investment managers utilize in investment decisions. Having a public report on sustainability goals that the company is trying to achieve shows shareholders and stakeowners how committed the firm actually is. Wannen is using the process ofshareholder advocacy to ask for Actavis to consider adopting this sustainability report. In order to file a shareholder resolution, one must own the stock for one year and hold at least $2,000 worth.
Actavis Inc., formerly Watson Pharmaceuticals, Inc., is an $18 billion integrated global specialty pharmaceutical company engaged in the development, manufacturing, marketing, sale and distribution of pharmaceutical products based in Parsippany, NJ.
Sustainvest Asset Management, LLC is an independent registered investment advisory firm focused on integrating sustainable and responsible investing into investment management. The company is based in Petaluma, CA.