Domini Funds 2017 Impact Report

Today, we stand at a pivotal moment in the history of our field, as we work to assess and document the impacts we have had on the lives of people and the health of our planet.

We are very happy to release the Domini Funds 2017 Impact Report, detailing how we create positive change through standards setting, advocacy, and fixed-income community investing.

Download the Report First Quarter 2018 Update

2018

First Quarter

Why we decided to exclude Facebook from our portfolios
How changes in the auto industry led us to update our Key Performance Indicators
What we are doing to address gun violence, as corporations respond to the latest tragedy in Parkland
Updates to our advocacy work addressing palm oil and deforestation, humans rights, corporate sustainability reporting, and tax practices
How our Bond Fund is allocated across impact themes, including a highlight of new farm credit investments

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Past Updates

First Quarter - Chipotle Agrees to Begin Comprehensive Sustainability Reporting; Building More Transparent Markets; A Landmark for Digital Rights: Seven European Telecommunications Companies Join Global Network Initiative; It Takes A Village: Domini’s Collaborative Approach to Corporate and Policy Engagement.

Second Quarter - Michael Kors Adopts Protections for Migrant Workers; Crisis in Bangladesh; Addressing Forestry Crime; Defending our Right to Submit Shareholder Proposals

Third Quarter - Preventing Deforestation; Persecution of Rohingya Muslims in Myanmar; Climate Change Mitigation; Financing the Sustainable Development Goals; Efforts to “Reform” the Shareholder Proposal Process

Full Year 2017 - In the Domini Funds 2017 Impact Report, we take a comprehensive look at how we work for change, including the positive impacts of standards setting, advocacy, and community investing.

First Quarter Second Quarter Third Quarter 2017 Impact Report

First Quarter - Positive change at Four Companies, Stock Exchange Listing Standards, Addressing Corporate Tax Avoidance, Deepening our Impact – Green Bonds
Second Quarter - A Season of Accountability, Protecting Freedom of Expression and Privacy on the Internet, Focus on Public Policy
Third Quarter - Thought Leadership on Climate Change, Corporate Engagement Spotlight, Fixed Income Engagement community development credit unions
Fourth Quarter - Protecting Migrant Workers, Climate Change, Current Shareholder Proposals

First Quarter Second Quarter Third Quarter Fourth Quarter

In the first quarter, the Domini Social Equity Fund reached important agreements with several companies, including the following:

Lowe’s, the world’s second largest home improvement retailer, agreed to eliminate neonicotinoid pesticides — a leading contributor to significant declines of honeybees and other pollinators — from its stores by 2019.
Avon set new standards for its purchases of palm oil and palm oil derivatives (products derived from palm oil), to reduce its impact on deforestation and human rights.
MeadWestvaco agreed to full disclosure of its political contributions.

Our second quarter update focused on the Domini Social Bond Fund’s investments in community health, affordable housing and energy efficiency.

Our third quarter report addressed recent policy successes at the U.S. Department of Labor on the legal standards guiding the use of social and environmental considerations by private pension plans and at the United Nations on corporate sustainability reporting. We also discuss our work on sustainable fisheries and animal welfare.

Our fourth quarter report details our work with other investors to urge companies to adopt and publish principles for minimum wage reform, our engagement with Coca-Cola regarding its response to the problem of obesity, and our continued efforts to persuade companies to curb the distribution of neonicotinoid pesticides, a leading culprit in global declines of pollinators, including honeybees. We also announce the thirteen shareholder proposals submitted by the Domini Social Equity Fund and discuss our advocacy at the Securities and Exchange Commission on a key shareholder rights issue.

Download our 2015 Social Impact Updates (above) to learn more about how Domini has been putting your dollars to work for change.

First Quarter Second Quarter Third Quarter Fourth Quarter

Celebrating Twenty Years of Shareholder Activism: For the past twenty years, shareholders of the Domini Funds have used their investments to enable conversations with executives at some of the largest and most influential corporations on a wide range of social and environmental issues. Since our first shareholder resolution was submitted in 1993, Domini has filed more than 250 proposals at 95 different corporations.

Addressing Corporate Tax Avoidance: Domini is taking a leading role in asking corporations to adopt more responsible and transparent tax strategies. Our first of its kind proposal, asking Google to adopt a set of ethical principles to guide its tax strategies, helped to raise awareness or this critical issue and led to our first conversation with Google about its tax strategies, a dialogue that we hope will continue. We also engaged in dialogue with Apple, American Express, Coca-Cola, Microsoft and the Walt Disney Company.

De-militarizing Amazon.com: Domini wrote a letter to Amazon.com CEO Jeff Bezos, raising concerns about the company's participation in the militarization of the civilian firearms market, after we discovered semi-automatic weapon accessories being sold on Amazon that could help gun owners increase the firepower of their weapons. Amazon executives took our letter quite seriously, and most of the products we identified have been removed and added to the company's list of prohibited items.

Deforestation: During the year, we engaged with Mondelez, PepsiCo, Kraft and Avon to ensure that their supply chain purchases are not inadvertently driving human rights violations or deforestation. Both Mondelez and PepsiCo announced efforts to address deforestation, with a particular focus on palm oil.

We also engaged Lowe’s, on the sale of products that contain pesticides that are harmful to honeybees and other pollinators, and we asked Chipotle Mexican Grill to produce a sustainability report to substantiate claims about the company's social and environmental commitments.

First Quarter Second Quarter Third Quarter Fourth Quarter

Crisis in Bangladesh: In response to a series of tragic disasters in Bangladeshi factories, culminating in the worst accident in the history of the apparel industry – the collapse of the Rana Plaza factory complex in Dhaka – Domini helped coordinate an investor statement backed by 200 institutional investors managing more than $3 trillion. The statement is being used to engage global companies on their efforts to address fire and safety conditions in Bangladesh.

Freedom of Expression and Privacy: Domini is a founding board member of the Global Network Initiative (GNI), a human rights organization focused on protecting freedom of expression and privacy rights on the Internet and other telecommunications technologies. In 2013, the GNI completed its first full round of independent assessments of founding companies Google, Microsoft and Yahoo. Domini helped to design GNI’s independent assessment framework. The GNI also welcomed Facebook as a new member during the year.

Corporate Political Accountability: Since 2009, we have been actively engaged with JPMorgan Chase to encourage full disclosure and effective board oversight of the bank’s political spending. In 2013, after discussions with Domini, the bank completed a series of important changes to its political spending policies, effectively withdrawing from electoral politics. After several years of receiving shareholder proposals from Domini, AT&T began complete disclosure of its direct political contributions (we continue to press the company to disclose its indirect contributions).

Corporate Sustainability Reporting: Domini was pleased to participate on a drafting committee coordinated by the Investor Network on Climate Risk to produce a draft listing standard on corporate sustainability reporting. The draft standard was prepared in response to a request from the NASDAQ OMX exchange for presentation to the World Federation of Exchanges, an association of the world’s stock exchanges.

During the year, we also engaged several companies on pesticides and colony collapse disorder, a major threat to honey-bee populations, forestry practices and climate change. Read our quarterly Social Impact Updates for more details.

First Quarter Second Quarter Third Quarter Fourth Quarter

Confronting Coal Financing: In 2010, PNC Financial Services adopted a policy prohibiting the direct financing of mountaintop removal coal mining. Nonetheless, like many mainstream banks, PNC continues to service coal-mining clients. This year, we joined other investors in filing a proposal asking the bank to address the climate impact of its financial services, including its lending to coal companies. We look forward to continuing our dialogue with PNC.

Sustainable Forestry Engagements: Before we can begin to address the problem of global deforestation, we need quality information. This year, in response to engagement by Domini, Lowe’s, the home improvement company,published a detailed report outlining its efforts to purchase sustainably harvested wood and reduce its impact on threatened forests. RR Donnelley, a global printing company, also agreed to talk to us about our concerns regarding its paper sourcing policies and has taken several important steps to address its exposure to illegal deforestation.

Addressing the Impacts of Payday Lending: A number of large banks have begun offering “payday lending” services, in which they provide the working poor with advances on their paychecks, generally at exorbitant fees that can trap the borrowers in cycles of debt. This year, working closely with the Center for Responsible Lending, we filed a proposal with US Bancorp, asking the bank to address concerns regarding its “checking account advance” program, a payday lending service. Our proposal prompted an informative dialogue with bank executives, culminating in an agreement to withdraw our proposal in exchange for continuing discussions and the bank’s commitment to publicly address how it is mitigating the potential risks of its service.

Taking a Stand against Bribery and Corruption: Since 1977, the U.S. Foreign Corrupt Practices Act(FCPA) has placed the U.S. at the forefront of the fight against bribery and corruption around the world. Recently, the U.S. Chamber of Commerce, a powerful business lobbying group, proposed certain “clarifications” to the FCPA that many believe will weaken our government’s enforcement efforts. In response, we met with senior officials at the Securities and Exchange Commission and the Department of Justice – the two agencies with joint authority over the FCPA – to express our strong support for the Act and our concerns about any efforts to weaken it. We then worked with other investors to draft a statement explaining in detail why strong enforcement is in the best long-term interests of investors, corporations and society. In mid-August we submitted the final statement to the SEC and DOJ, on behalf of more than fifty institutional investors managing more than $3 trillion, in addition to several large investor networks.

First Quarter Second Quarter Third Quarter Fourth Quarter

Improving Corporate Political Transparency: In 2010, the Supreme Court’s controversial decision in Citizens United v. Federal Election Commission freed corporations to spend unlimited amounts of money to influence political elections. Since 2004, Domini has worked to foster transparency and accountability of corporate political spending. In 2011, we filed a legal brief with Montana’s Supreme Court supporting their efforts to maintain a century-old law banning corporate political contributions in the state, wrote a letter to President Obama endorsing a draft executive order that would require all companies seeking government contracts to publicly disclose their political contributions, and sent a letter to the SEC in support of a petition asking for a rule requiring corporations to disclose spending on political activities. In addition, we re-filed proposals with AT&T and JPMorgan Chase, seeking disclosure of their political spending.

Addressing Global Deforestation: We filed proposals with Kraft, Lowes, and RR Donnelley, seeking reports on their efforts to address their impacts on deforestation. All three companies were willing to talk to us about our concerns.

Global Network Initiative – Internet Censorship and Surveillance: During the year, Domini continued to participate as an active member of the board of the Global Network Initiative, a human rights organization addressing threats to freedom of expression and privacy on the Internet and other telecommunication technologies (GNI includes Microsoft, Yahoo, and Google). This year, our human rights proposal at Cisco Systems received a 42.5% vote – the highest we’ve received to date.

Conflict Risk Network – Sudan, Libya, and Syria: The Conflict Risk Network (CRN) is a network of investors and other stakeholders working to ensure that corporations uphold human rights and support peace and stability when operating in areas affected by genocide and mass atrocities. Domini is a founding member of CRN and serves on its advisory board. During the year we worked with CRN members to engage the Swedish company Atlas COPCO concerning its operations in Sudan; Saras, an Italian oil company, to express concerns regarding its sales of fuel to the Libyan military under Qaddafi; and 11 other oil and gas companies operating in Syria to express concerns regarding the Syrian government’s violent crackdown on pro-democracy activists.

First Quarter Second Quarter Third Quarter Fourth Quarter

Domini Reaches Agreement with Nucor on Slavery in Brazil: The largest steel producer in the United States,Nucor, is also the largest buyer of Brazilian pig iron, a key ingredient in the manufacture of steel. In a 2006 cover story, Bloomberg Markets magazine opened a window into the small camps that produce the charcoal used to make pig iron, exposing a world of slavery, inhuman working conditions and illegal deforestation. After a three-year engagement, Nucor agreed to adopt a strong set of policies to address slavery in its Brazilian supply chain.

Toyota Motor Cuts Ties with Burmese Military Regime: While researching Toyota Motor, Domini analyst Shin Furuya discovered that Toyota Tsusho, the company’s major trading partner, was in partnership with the Burmese military regime to sell motorcycles, light trucks, and cars. This information was uncovered in Japanese, and was apparently unknown to both human rights activists and investors. After a three year dialogue with Domini and other investors, Toyota announced that its trading partner had ended its joint venture with the Burmese government.

Ending the Secrecy of Corporate Political Contributions: In 2010, Domini resubmitted shareholder proposals asking AT&T, Goldman Sachs, and JPMorgan Chase to disclose their political contributions. We joined other investors in filing proposals with 3M, Best Buy, and Target, seeking a review of their political activity in order to highlight the potential financial risks when companies pay for election ads. All three companies contributed to Minnesota Forward, an organization that financed election advertisements in support of the election of Tom Emmer for Governor of Minnesota. Emmer’s opposition to gay marriage led to a consumer boycott of Target, a company with a particularly gay-friendly profile.

Protecting Consumers from Toxins in Products: Domini has addressed the issue of toxins in consumer products for years, through our Global Investment Standards and our direct engagement with companies. In 2010, Domini filed with Coca-Cola the first shareholder proposal ever to focus on bisphenol-A (BPA), a chemical used in the lining of cans. A report by the President’s Cancer Panel noted a “growing link between BPA and several diseases, including various cancers.” Domini’s proposal received a strong 22% vote at the company’s annual meeting, in addition to substantial press coverage.

First Quarter Second Quarter Third Quarter Fourth Quarter

Celebrating 15 Years of Shareholder Activism: 2009 marked the 15th anniversary of Domini’s shareholder activism program. Since 1994, we have filed more than 200 resolutions with more than 80 companies and engaged in numerous long-term dialogues with corporate management on a range of social, environmental, and governance issues.

Predatory Credit Card Practices: As part of a campaign against credit card practices that lock consumers in a deepening cycle of debt, Domini filed resolutions with Bank of America and American Express. Domini’s resolution with Bank of America gained a vote of more than 33%. Among other suggestions, the resolution asked the company to end the practice of raising interest rates on consumers who had not been delinquent in their payments. We were pleased to be able to withdraw our proposal at American Express after productive discussions with the company.

Domini Executive Selected for SEC Investor Advisory Committee: Domini’s Managing Director and General Counsel was selected to join the Securities and Exchange Commission’s newly formed Investor Advisory Committee. The 18-member committee was established to provide the SEC with the views of a broad spectrum of investors on the Commission’s regulatory agenda.

Domini Urges Mandatory Corporate Sustainability Reporting: Domini worked with the Social Investment Forum on a proposal asking the SEC to require companies to produce an annual sustainability report using theGlobal Reporting Initiative (GRI) guidelines, the world’s leading format for corporate sustainability reporting. Domini also joined other shareholders in a successful effort to ask the SEC to reverse its practice of allowing companies to exclude from their proxy statements proposals that ask companies to conduct a “risk evaluation” of a social or environmental issue.

Domini Seeks Disclosure of Corporate Political Contributions: In the fourth quarter of 2009, Domini filed shareholder proposals asking AT&T, Goldman Sachs, and JPMorgan Chase to fully disclose their political contributions.

First Quarter Second Quarter Third Quarter

Domini Impact Equity Fund ℠

Domini Impact International Equity Fund ℠

Domini Impact Bond Fund ℠

Impact Updates & Reports

Domini Funds 2017 Impact Report

2018

Past Updates