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14
May 2002, NEWSPAPER ARTICLE
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CONSERVATIONIST BRINGS A NEW YEAR'S RESOLUTION IN FRONT
OF POTLATCH
John Osborn authored his first shareholder resolution in
1996.
By
Becky Kramer Staff
Spokesman-Review May 14, 2002
SPOKANE
It
was a new approach for the Spokane physician and longtime
conservationist. After years of testifying before Congress
and appealing timber sales, Osborn figured that pressure
from company shareholders might be the most effective avenue
for long-term change.
Every
spring -- when annual meetings crop up like a new growth of
dandelions -- Osborn authors at least one shareholder
resolution.
"Our
effort is to find common ground between people concerned
with the environment and Wall Street investors. Oftentimes,
environmental problems are symptomatic of an underlying
problem with corporate accountability," said Osborn,
co-founder of the Spokane-based Lands Council.
This
year, Osborn's target is the Potlatch Corp. At Wednesday's
annual meeting, he'll ask the company's shareholders to
support two resolutions. One asks Potlatch to reveal how
many shares are owned by descendents of timber baron
Frederick Weyerhaeuser, who was one of Potlatch's early
investors. The other resolution asks Potlatch to explain why
it is paying dividends when the company is losing
money.
Potlatch
opposes both resolutions. Officials said the company's
ownership and dividend policy are clearly explained in its
public financial reports. "The proposal can only be
explained as an attempt to advance Osborn's personal
interest in environmental matters by embarrassing the
company and the Weyerhaeuser family ..." Potlatch officials
wrote in a letter to the U.S. Securities and Exchange
Commission.
Shareholder
resolutions are nonbinding requests for company action.
Authors use them to gain leverage, hoping that they'll
generate enough support to force the company to act on the
issue.
Over
the past seven years, Osborn's resolutions have had mixed
success. This year, for instance, he is part of a national
campaign targeting five companies. So far, the
conservationists are batting two to two.
At
Weyerhaeuser and Boise Cascade's annual meetings last month,
shareholders approved resolutions asking for annual election
of the board of directors.
At
Plum Creek and Georgia Pacific, however, shareholders
overwhelmingly rejected proposals asking the companies to
institute a 10-point code of environmental
conduct.
Osborn
said resolutions aimed at corporate accountability generally
do better than ones with an outright environmental
slant.
However,
"We're really cutting new ground here," he said. "I'm
encouraged by the votes."
The
resolutions have opened up dialogue with the companies and
their institutional investors, said Bart Naylor, a
consultant to the campaign, which includes the Idaho
Conservation League and the Sierra Club.
For
example, Naylor said he talked to 25 of Weyerhaeuser's
largest investors this year. "It is a happy thing that all
of them consider themselves environmentalists," he said.
"Through appealing to corporate shareholders, we're trying
to raise pressure for environmental sensitivity."
But
even when resolutions pass, companies are under no
obligation to act. Shareholder resolutions calling for
annual elections of officers have passed several times at
Weyerhaeuser's and Boise Cascade's annual meetings. Both
companies still elect officers in staggered
terms.
Weyerhaeuser's
board has opposed the resolution, saying that the 12-member
board needs some continuity.
With
three-year terms, the board already has the potential to
turn over in a short time, the board said. At Boise Cascade,
the board's governance committee will evaluate the proposal.
"They'll make a recommendation based on what they feel is in
the best interests of the company and the shareholders,"
said Linda Alden, spokeswoman for Boise Cascade, which
recently renamed itself "Boise."
Changing
the terms of election would require the board to submit a
proposal to the shareholders. Eighty percent of the
shareholders would have to approve the resolution for it to
pass, Alden said.
o
Becky Kramer can be reached at (208) 765-7122 or by e-mail
at beckyk@spokesman.com.
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