August 18, 2010
From Transparency
to Performance: Industry-Based Sustainability Reporting on Key Issues
Domini Chief Investment Officer Steve Lydenberg, in collaboration with
Jean Rogers of the consulting firm Arup and David Wood of the Initiative for Responsible
Investment, has published From
Transparency to Performance: Industry-Based Sustainability Reporting on Key
Issues(PDF).
The authors believe that mandatory sustainability reporting is urgently
needed in the U.S. and that the development of industry-based key performance
indicators can play a crucial role in any such mandatory reporting scheme.
“It is our hope,” they write, “that establishing KPIs [key performance indicators]
for all sectors will enable companies to move from a compliance driven
‘disclosure’ mindset to one of managing — and even competing on — performance
on the sustainability issues that matter most.”
The reports builds on the important work done by the Global Reporting
Initiative in establishing a “credible set of universally applicable
indicators” and outlines a method for the development of KPIs within the
context of this broader set of indicators.
This method for developing KPIs relies on three principles: simplicity,
materiality, and transparency. This method should be useful for regulators and
stock exchanges considering target requirements, corporations seeking to
improve their sustainability reporting, and stakeholders and investors who wish
to improve their assessment of the progress of companies toward sustainability.
July 22, 2010
International
Investor Coalition Urgently Calls for Improved Working Conditions in
Electronics Manufacturing Facilities
Rash of Worker
Suicides at Foxconn Electronics Facility in China Causes Concern Among
Institutional Investors. Stricter Supply Chain Monitoring and Systemic
Oversight by the EICC is Urged.
In light of a series of suicides at the Foxconn Electronics
facility in China, a broad coalition of over 40 European, Australian and U.S.
investors have joined their voices to issue a public
statement condemning abusive workplace conditions in the global electronics
supply chain. Worker abuses such as excessive overtime and supervisor
harassment which are endemic in the electronics manufacturing sector have been
cited by non-governmental organizations as contributing to excessive stress and
grave mental health issues among factory workers. In issuing this statement,
the group, led by Boston Common Asset Management, LLC, Trillium Asset
Management Corporation, As You Sow and Domini Social Investments LLC, all
members of the Interfaith Center on Corporate Responsibility, sends a strong
message to the electronics manufacturers in their portfolios urging stricter
supply chain compliance.
"We believe this is a wake-up call for the electronic
industry to intensify its efforts to improve working conditions and the quality
of life for workers producing their products. We urge companies, suppliers,
governments and investors to focus on building more sustainable supply chains
that mitigate risks while building safe and harmonious workplaces," said
Steven Heim, Managing Director and Director of ESG Research and Shareholder
Advocacy at Boston Common Asset Management.
The statement, with 45 investor signatories, urges the
consumer electronics companies in their portfolios such as Apple, Dell, and
Hewlett-Packard who are leaders in their industry to redouble efforts to
strictly monitor the practices of their suppliers to insure safer, less
stressful workplace conditions and to promote worker rights. The Electronics
Industry Citizenship Coalition (EICC), a 40-member organization including most
global electronics companies, works to enforce supply chain compliance and has
developed a code of conduct regarding specific labor and health and safety
practices that has been widely adopted by the industry. The investor group
supports this industry initiative and believes the EICC needs to go further in
promoting worker rights and in demanding full disclosure on supply chain
practices.
"As members of the Interfaith Center on Corporate
Responsibility (ICCR) we have been pressing for greater supply chain
accountability in this sector and other sectors for over 15 years," said
Rev. David Schilling, Director of Human Rights at the ICCR, a 275-member
coalition of faith-based and institutional investors engaged in shareholder
advocacy. "It is important from a human as well as a financial perspective
to implement systemic solutions to address the challenges facing workers in
complex global supply chains."
Jonas Kron, VP, Trillium Asset Management said, "In
addition to the human rights implications, we are deeply concerned as
institutional investors about the material impact that events like the recent
suicides at Foxconn may have on our portfolios. Regardless of where manufacturing is located, companies, investors
and governments need to consider the long-term impact of these issues and not
focuses just on short-term responses."
"The Foxconn suicides are the latest reverberations of
an alarm that has been ringing for many years now. The foundation of our global
manufacturing system is not sustainable. Without strong investor support for
meaningful change on the factory floor, we will continue to drift from crisis
to crisis," said Adam Kanzer, Managing Director and General Counsel for
Domini Social Investments.
The group specifically supports efforts which include
offering training on worker's rights, limits on overtime, training for line
supervisors and managers to eliminate harassment and other forms of abuse and
supporting worker's rights to union representation and collective bargaining.
"Failing to provide a decent living wage and safe
working conditions is unacceptable for any company in any sector. Consumers
understand this. There exists a clear financial opportunity for companies that
take a lead, and considerable risks for those who do not," said Neil
Brown, SRI Fund Manager, Aviva Investors.
As of June 30, 2010, Apple, Dell, and Hewlett-Packard
represented 4.5%, <0.1%, and <0.1%, respectively, of the Domini Social
Equity Fund’s portfolio. Foxconn was not held by the Domini Funds. The composition
of the Funds’ portfolios is subject to change.
July 16, 2010
Safety Last?: BP,
Toyota, and Massey Energy
Domini avoided investments in BP,
Toyota, and Massey Energy: three major companies that have recently experienced
devastating public scandals and catastrophes.
That Domini avoided these three companies demonstrates that social and
environmental standards can make a difference in investment decisions. Such
standards can provide early warning signals for major disasters to come.
A look at these companies underlines the importance of evaluating the
safety record of publicly traded corporations before making the decision to
invest, particularly for energy and transportation companies.
BP
Despite BP’s commitment to alternative energy and its public statements
on the need to address global warming, we have consistently rejected BP for the
Domini Funds based on a pattern of safety and environmental concerns, including
a 2005 explosion at BP’s Texas City refinery that killed 15 employees and an
oil spill and persistent corrosion issues at the company’s Prudhoe Bay pipeline
operations. Several years ago, we informed a BP representative that they would
have to substantially improve their safety record to be approved for our funds.
We have also consistently excluded the two other companies involved in the
Deepwater Horizon disaster, Transocean and
Halliburton, for a variety of social
and environmental reasons.
Toyota Motor
The extensive safety
and quality problems that forced Toyota
Motors to make its massive worldwide recalls in 2009 severely damaged the
reputation of a company that had in the past been praised for its quality,
employee, and environmental initiatives. However, our research identified a
number of negative factors that counterbalanced the positive press that the
firm had been receiving. One of our concerns was the company’s consistent
record of major vehicle recalls in Japan (over 1.887 million in 2004, over 1.88
million in 2005, and about 1.3 million in 2006), as well as a pattern of labor
relations problems in the Philippines (anti-union activity) and Japan (abusive
“cosmetic subcontracting”).
Domini was also among the first in the SRI world to uncover Toyota’s
involvement in Burma through a partially owned auto components subsidiary. (See
our second-quarter 2008 Social Impact Update
for the full story). We continue to engage with the company, urging it to end
this relationship. Finally, in
our view, Toyota’s sales of energy-efficient hybrids are largely offset by
sales of light trucks and SUVs, giving it only an average overall record on
fuel efficiency for its fleets.
This pattern of
controversies and relatively weak positives led us to consistently exclude the
firm from our portfolios.
Massey Energy
The decision not to hold Massey Energy was relatively straightforward,
since Domini rarely approves companies that have substantial involvement in
coal mining. Coal emits one of the highest percentages of greenhouse gases per
unit of energy produced among the fossil fuels. In addition, as an industry,
coal mining firms have a long historical pattern of safety challenges. Although
we don’t automatically eliminate all coal companies, we must see an exceptional
record of positive social and environmental initiatives in order for such firms
to qualify for inclusion, a circumstance Domini rarely encounters. Massey
Energy was no exception to this general rule.
Key Performance
Indicators
Integral to our research and standards setting process is the use of “key
performance indicators” For each industry, we identify approximately a half
dozen key business-alignment and stakeholder-relations factors that take
precedence in our decision making. These indicators focus our analysts on the key sustainability challenges each
company faces. For example, safety is a key indicator for us for both the
automotive industry and for energy companies. If a major oil and gas company
has a poor safety record, that factor may well override other positive aspects
of its social and environmental performance. Learn more about how Domini applies
its standards.
Our investment
process by no means guarantees that we will avoid all companies with
controversies. Many companies that we approve have mixed records where we feel
strengths counterbalance concerns. Unanticipated problems and controversies can
occur in others. We do believe, however, that it is important to signal our concern
about safety and environmental issues to major corporations both by refusing to
invest in some and engaging with others, in the hopes that concerted ongoing
efforts by concerned investors like ourselves and our peers will over time
bring about positive change.
You should
consider the Domini Funds' investment objectives, risks, charges and expenses
carefully before investing. View
or order
a copy of the Funds' current prospectus for more complete information on these
and other topics. Please read the prospectus carefully before investing or
sending money.
The
composition of the Funds’ portfolios is subject to change.
DSIL Investment Services, LLC, distributor. 06/10
July 2, 2010
Amy Domini Calls
for an End to “Economically Useless” Investment Vehicles
Amy Domini, founder and CEO of Domini Social Investments, participated
in the high-level OECD Annual Forum in Paris on May 27, and published a new
article in the OECD’s magazine, OECD Observer. This year’s forum was entitled
“Road to Recovery: Innovation, Jobs & Clean Growth.” The Organisation for
Economic Co-operation and Development (OECD) is an organization of 34 developed
countries committed to democracy and the market economy.
Amy participated in a
panel discussion including representatives of both trade unions and private
sector firms regarding how improved business ethics could help to restore
public trust in financial and corporate institutions. Amy spoke of the pivotal
role of finance in achieving more ethical business models: “If finance is
working against the goals of human dignity and ecological sustainability, then
governments and civil society will be incapable of achieving those goals of
restoring trust.”
Concurrent with the
conference, Amy published a call for investors to cease the destructive practice of
diversifying their assets into “economically useless vehicles.”
In “Saving
Capitalism from Futile Diversification,” an article published in the OECD
Observer, Amy argues that Modern
Portfolio Theory, the dominant approach to professional portfolio management,
has promoted the benefits of diversification, yet broad diversification did not
protect investors during the global financial crisis.
In fact, Amy writes, the emphasis on diversification at all costs led
financial firms to create derivative instruments based on the value of real
assets that institutional investors didn’t own and didn’t want. “They found
they could bet on real estate without owning it, they could bet on the interest
rate a mortgage paid versus what a treasury bill paid, they could bet on robust
demand for rice without owning the rice.” Speculation on commodities drove
double-digit increases in the price of staple foods, creating starvation in
some African countries.
“Modern portfolio management gave birth to a healthy idea:
diversification,” Amy concludes. “But that healthy idea has been subverted.
This is not a problem that markets can correct on their own: the strong arm of
government must be utilized before the second wave occurs. Diversification into
assets that produce no goods or services to humankind undermines capitalism.”
Amy Domini was honored by Time
magazine in 2009 as one of 25 “Responsibility
Pioneers,” and in 2005 as one of the 100
most influential people in the world. In 2008, Directorship
magazine included Amy Domini in its Directorship 100, a list of the most
influential people on corporate governance and in the boardroom. In 2010, Investment Advisor magazine listed her
as one of the “30
most influential individuals in and around the planning profession over the
last three decades.” She has received honorary doctorates from the
Northeastern University College of Law and Yale University’s Berkeley Divinity
School.
Further Reading:
You should consider the Domini Funds' investment objectives,
risks, charges and expenses carefully before investing. View or order
a copy of the Funds' current prospectus for more complete information on these
and other topics. Please read the prospectus carefully before investing or
sending money.
DSIL Investment Services, LLC, distributor. 06/10
May 26, 2010
Amy Domini Named
One of Thirty Most Influential by Investment Advisor Magazine
Investment Advisor magazine included
Amy Domini, founder and CEO of Domini Social Investments, in its “Thirty
for Thirty” list of the “30 most influential individuals in and around the
planning profession over the last three decades.” The list ran in the
magazine’s May 2010 issue, which also included an interview
with Amy Domini.
“In the last 30 years,” the magazine wrote, “socially
responsible investing has become a force to be reckoned with, and for that you
can thank Amy Domini.” Investment Advisor
noted her involvement in the shareholder activism that helped bring about
peaceful change in South Africa, and her efforts to demonstrate that applying
social and environmental standards need not hurt investment performance.
“Not slowing down at all,” the magazine concluded,
“the founder and CEO of Domini Social Investments most recently wrote Socially Responsible Investing: Making a
Difference and Making Money.”
Amy Domini was honored by Time
magazine in 2009 as one of 25 “Responsibility Pioneers,” and in 2005 as one of the
100
most influential people in the world. In 2008, Directorship
magazine included Amy Domini in its Directorship 100, a list of the most
influential people on corporate governance and in the boardroom. She has received
honorary doctorates from the Northeastern University College of Law and Yale
University’s Berkeley Divinity School.
You should consider the Domini Funds' investment objectives,
risks, charges and expenses carefully before investing. View or order
a copy of the Funds' current prospectus for more complete information on these
and other topics. Please read the prospectus carefully before investing or
sending money.
DSIL Investment Services, LLC, distributor. 05/10
May 25, 2010
Domini Endorses
Forest Footprint Disclosure Project
Domini
Social Investments has endorsed the Forest
Footprint Disclosure Project, a nonprofit organization that helps
investors assess the impact of companies on the world’s forests.
The Forest Footprint Disclosure Project (FFD Project) is a new
initiative supported by the British government and modeled on the Carbon
Disclosure Project, which questions companies on their greenhouse gas
emissions. The FFD sends an annual survey to companies with exposure to five
forest risk commodities: beef or leather, palm, soy, timber and
bio-fuel.
The survey, sent on behalf of investors managing more than $4 trillion, seeks
information about how companies are managing their impact on forests.
"Forest Footprint Disclosure is delighted to receive
support from Domini as another important investor recognizes the significant
influence on climate change mitigation that comes from protecting standing
forests through developing a sustainable supply chain for key commodities,”
said Christoph Harwood on behalf of the FFD Project.
Forests are rapidly
declining at a rate of 55 football fields per minute, according to the United
Nations. Only 20% of the world’s original forests remain undisturbed.
Amy Domini, Founder and CEO of Domini Social Investments, said, “Armed
with data, investors can play a leading role in repairing the unconscionable
damage we’ve done to our planet. Domini is pleased to endorse the work of the
Forest Footprint Disclosure Project and we look forward to working with the FFD
Project to increase the participation of U.S. companies. We strongly encourage
other investors to join us in this effort.”
Domini believes that it is essential for companies with significant
exposure to deforestation to map and mitigate their impact on these critical
ecosystems. Domini has taken a leadership position in addressing
forestry issues with our mutual fund holdings through our investment standards,
direct shareholder
engagement, and proxy
voting. Since 2007, Domini has been a member of the Boreal
Leadership Council, an organization devoted to protecting one of the world’s
largest forest ecosystems.
Deforestation
and Climate Change
The Stern Review on
the Economics of Climate Change states greenhouse gas emissions
from deforestation are greater than emissions from the global
transportation sector. Forests store extensive amounts of carbon, critical to
mitigating the effects of climate change. Forests store the equivalent of 175
years of global fossil fuel emissions and forest loss is responsible for 20% to
25% of total annual carbon dioxide emissions globally. Deforestation has
serious implications for biodiversity and human rights as well.
About the Forest
Footprint Disclosure Project
The Forest Footprint Disclosure Project asks
companies
to disclose how their operations and supply chains are impacting forests
worldwide, and what is being done to manage those impacts responsibly. The
purpose of the survey is to provide companies and investors with a better
understanding of the company’s ecological impact, and how the changing climate
and new regulatory frameworks could affect access to resources and the cost of
doing business in the long term.
The disclosure information will be reported annually,
enabling investors to identify the sustainable businesses of the future as well
as possible risks related to a company’s forest footprint. The Project
published the results of its first global survey in February.
April 27, 2010
Domini
Deposit Account at PNC Bank
The
Domini Money Market Account (DMMA) formerly offered through an arrangement with
ShoreBank, has been changed to the Domini Deposit Account offered through an
arrangement with PNC Bank.
PNC
Bank, National Association, is the country’s fifth largest bank based on
deposits and branches. All DMMA deposits were transferred to PNC Bank on April
27, 2010. There has been no interruption in service, and you can continue to
access your funds and use your Domini Account just as you have before. Your
balance will be reflected on your statements and on our online account access
system as “Domini Deposit Account.” Any future deposits will also be directed
to PNC Bank, including any deposits scheduled through an Automatic Investment
Program.
The
Domini Deposit Account will be subject to a $3 monthly service charge,
effective June 15, 2010. This charge will be automatically withdrawn from your
Account on the 15th of each month (or the next applicable business
day). If you decided to close your Domini Deposit Account prior to June 15,
2010, your Account will not be charged the $3 monthly service charge.
The
Domini Deposit Account offers:
- Federal
insurance. Each depositor is federally insured by the Federal Deposit
Insurance Corporation (FDIC) up to $250,000, subject to FDIC conditions.*
- Annual
Percentage Yield of 0.15%.**
- Check-writing,
with a $500 minimum per check. (Check writing is not available for IRAs.) You
will not need to obtain new checks — your DMMA checks will continue to be
honored.
- Daily
liquidity and easy exchanges between your Domini Deposit Account and any
of the Domini mutual funds.
If you have any questions or concerns, please call us
at 1-800-582-6757, weekdays from 9AM to 5PM Eastern Time. We thank you for
investing with Domini and look forward to continuing to make a difference
together.
*The
Federal Deposit Insurance Corporation has increased the coverage on deposits
from $100,000 to $250,000 per depositor, through December 31, 2013. The amount
that you have on deposit in the Domini Deposit Account at PNC Bank will be
added to any other money you may have on deposit at PNC Bank for purposes of
determining your aggregate insurance limit with PNC Bank. Please review your
Domini Deposit Account balance as the FDIC coverage limit applicable to your
deposit has been changed.
**
Current rate and annual percentage yield (APY) subject to change at any time
without notice. Visit www.domini.com
to review the current rate and APY.
Please note that the
Domini Deposit Account is only available to individuals and certain governmental
units, trusts, and nonprofit organizations.
The Domini Deposit Account
at PNC Bank is a NOW account. Please note that you will only be able to access
your Domini Deposit Account funds through Domini Social Investments. Domini
Social Investments will act as your agent for the purpose of making deposits to
and withdrawals from the Domini Deposit Account and will maintain the records
of your balance and transactions. You will not be able to access your funds in
the Domini Deposit Account or obtain balance information by contacting PNC Bank
directly.
The Domini Deposit
Account is made available through an arrangement with PNC Bank, National
Association, member FDIC. Domini Social Investments LLC and the mutual funds
offered through Domini are not affiliated with any bank and are not FDIC
insured. Domini Social Investments LLC retains the right to replace PNC Bank
with another FDIC member institution at its discretion. Prompt notice regarding
any such change will be provided.
March 25, 2010
Fund Merger
Complete
As of the close of business on
March 19, 2010, the Domini European Social Equity Fund and the Domini PacAsia
Social Equity Fund merged into the Domini
International Social Equity Fund (formerly known as the Domini European
PacAsia Social Equity Fund). The merger was approved by shareholders on March
9.
The Domini European Social Equity
Fund and the Domini PacAsia Social Equity Fund are no longer available for
investment. At the close of business on March 19, shareholders in these funds
received shares of the Domini International Social Equity Fund equal in value
to their holdings in these funds.
The Domini International Social Equity Fund offers a convenient way for
shareholders to gain access to markets around the world, while helping bring
about social and environmental change.
The fund is offered in no-load
Investor class shares (NASDQ: DOMIX) and in
Class A shares (NASDQ: DOMAX). Its CUSIP number is 257132704 (Investor
shares) or 257132886 (Class A shares). Learn
more about the fund or open an account.
The
Domini International Social Equity Fund is not insured and is subject to market
risks. You may lose money.
Investing
internationally involves special risks, such as currency fluctuations, social
and economic instability, differing securities regulations and accounting
standards, limited public information, possible changes in taxation, and
periods of illiquidity.
Although
the Fund’s Investor shares are no-load, certain fees and expenses apply to a
continued investment and are described in the prospectus. The composition of
the Fund’s portfolio is subject to change.
March 3, 2010
New Report: “How
to Read a Corporate Social Responsibility Report”
Domini Chief Investment Officer Steve Lydenberg, in collaboration with
David Wood of the Institute for Responsible Investment, has published How to Read a
Corporate Social Responsibility Report: A User’s Guide (PDF).
Before 1992, corporate reports detailing the company’s impact on society
and ecosystems were relatively unknown. By 2008, however, more than 3,300
companies worldwide were publishing annual “CSR” or “sustainability” reports,
which range from highly detailed reports to slim glossy brochures.
Because these reports are generally produced on a voluntary basis, their
quality remains highly inconsistent. They often contain extremely valuable
information, however, that can help investors, companies, and communities make
better decisions together about our shared future. How to Read a Corporate Social Responsibility Report is a practical
guide for those who want to gain the most benefit from these reports, providing
helpful tips to both reporters and readers.
The guide discusses the dramatic increase in CSR reporting, lists the
many purposes the reports serve, describes and examines the features of a
thorough CSR report, and surveys standards and programs that assess and
recognize CSR initiatives.
“With CSR reports becoming longer, more numerous, and often more
confusing," writes Steve Lydenberg, "this guide can
help identify the issues, data, and interpretations that
are most meaningful.”
February 2, 2010
Special Notice for
Shareholders in Our European and PacAsia Funds
As a shareholder in the Domini European Social Equity Fund or Domini
PacAsia Social Equity Fund, you should have received a proxy statement in the
mail regarding an important proposal that affects your funds. The combined
proxy statement and prospectus can
also be viewed here.
You are being asked to approve a reorganization of the Funds whereby the
Domini International Social Equity Fund will acquire all of the assets and
liabilities of the Domini European Social Equity Fund and the Domini PacAsia
Social Equity Fund.
After the completion of the transaction, the Domini European Social
Equity Fund and the Domini PacAsia Social Equity Fund will be dissolved and
will no longer be available for investment.
The Funds’ Board
of Trustees unanimously recommends that you vote “For” this proposal.
Please review the combined proxy statement and prospectus and cast your vote as follows:
Mail: Complete, sign,
and return the card you received in the mail, or
Phone: Call
1-800-690-6903 and follow the instructions (to speak to a live person, call
1-800-829-6554), or
Online: Visit www.proxyvote.com and follow
the instructions.
Your vote is
important and only takes a few minutes to cast. If you have any
questions or need help, please call 1-800-582-6757.
January 12, 2010
Domini Social Equity
Fund Outperforms S&P 500 by 9% in 2009
Lipper ranks socially responsible fund in top
10% of large cap core equity.
