A month ago I went to the General Dynamics annual shareholder meeting outside of Washington, D.C. You may remember I was going to introduce a resolution calling for investigation of corporate human rights practices with an eye to developing a human rights policy. The resolution got 17 percent of the votes cast.
This is important. By Securities and Exchange rules, shareholders cannot tell management what to do unless they take over the board. So resolutions can only make recommendations to the board. But because management controls so many proxies, the SEC says if a resolution gets 3 percent of the vote, it can be reintroduced the next year. The shareholder proponents did well at General Dynamics.
Tomorrow I am driving to the Caterpillar meeting in Little Rock, Ark. Little Rock? you ask. Perhaps you thought their HQ was Peoria, Ill. Well, yes, it is. Apparently the company is running away from the small band of activists. We criticize Caterpillar's sale of weaponized D9 bulldozers through the Pentagon to the Israeli Defense Force.
These weaponized bulldozers have gun turrets and reinforced steel siding. They are used to demolish Palestinian houses.
The shareholder protesters have protested in the meetings, but politely. Last year a dozen or so stood up at different times in the meeting, each attempting to tell the story of a Palestinian family whose home had been destroyed by a D9. They were escorted out and went quietly.
I've been at meetings where investors have called the treasurer a flunkey, referred to the board's behavior as "operation feather-their-nest" and shouted down the CEO. Interestingly, these were not the peace and justice protesters.
Nonetheless, Caterpillar is running away to Little Rock. Management's rules of conduct for the meeting forbid shareholders' distribution of written material in the building or asking more than one question. This is supposed to be a shareholder meeting, not a management meeting.
This resolution is also about developing a human rights police. It was submitted last year and received 20 percent of the vote. But this year, the company challenged the resolution with the SEC.
They wrote: At the core of the Proposal is a request that the Company's "policies related to human rights" be made to "conform more full with international human rights and humanitarian standards." It is not clear what is meant by the Company's "policies related to human rights." More significantly, perhaps, it is not at all clear as to which "international human rights and humanitarian standards" the Company's policies should be conformed.
The SEC denied their challenge.
I'd be grateful if you say a prayer for me. These meetings are tough.