The sunflowers and wheat fields of rural Kansas are a long way from Wall Street. But in the small town of Atchison, an unlikely group of investors are making a name for themselves as outspoken shareholder activists.
They start each day together in their monastery’s chapel, reciting hymns.
“‘Tis a gift to be simple, ‘tis a gift to be free,” the Benedictine Sisters of Mount St. Scholastica sang on a recent fall morning. “‘Tis a gift to come down where we ought to be.”
The 80 nuns at this monastery, an hour’s drive from Kansas City, live a humble life. They hold all their belongings communally, devoting their time to prayer and work.
But as they filtered into the dining room for breakfast, Sister Judith Sutera said that the growing health care costs of their aging membership — three-quarters of the sisters are 70 or older — have thrust the community into an awkward place: the stock market.
“Some people are really troubled by the fact that we have enough assets to invest. And I think there’s a misunderstanding,” Sutera said. “We have to have a certain amount of money in reserve because we have people we have to take care of.”
It forced the community to confront an ethical dilemma that would eventually propel them into economic activism: a lot of the companies in the stock market do things that contradict the nuns’ Catholic values.
‘Kind of a terrifying experience’
For the Benedictine sisters, stashing money away for the future is a necessary evil. Historically, they’ve worked for little or no pay, and invested their wages back into the communities they served. But in the late 1960s, that started to change, according to Sister Rose Marie Stallbaumer, who served as the community’s treasurer for two decades.
“We needed to do something to care for our aging members, who were living longer and needing more care,” she said. “So we started, very gradually, to set money aside.”
Stallbaumer said the sisters developed some ground rules: they wouldn’t invest in weapons-makers or fossil fuels. (The latter rule, they eventually would bend, as they realized investing small amounts in certain companies allowed them to push for change from within.)
“That had an effect on our investments. We maybe didn’t earn as much as we could,” she said. “But it was important for us to take that stand.”
Then, the sisters began advocating for change at the companies they did invest in. At shareholder meetings, they started bringing resolutions — demanding that large corporations give their workers health insurance or adopt climate-friendly policies. They estimate that they’ve filed more than 350 of these resolutions over the last twenty years.
Stallbaumer remembers traveling to Oklahoma to attend her first shareholder meeting for Halliburton, where she was introducing a resolution opposing the company’s Iraq war contracts. In front of a room of board members and shareholders in suits, she stood up to speak.
“Someone from the company held the mic in front of me so that he could pull it away if I said something they didn’t want me to say,” she said. “It was kind of a terrifying experience.”
Nobody took the microphone away from her. But once she finished, she says, a company representative told the other shareholders to vote against her resolution. And she said most of them did. (Halliburton sold its division that handled the military contracts in 2007, following years of pressure. The company declined to speak on the record for this story.)
“The results of the votes weren’t that great, especially in those early years,” Stallbaumer said. “But it brought awareness to other shareholders. It also gave us the opportunity, with some of these companies, to sit down with the CEO and talk about these issues.”
Stallbaumer declined to say how much money the monastery has invested in total, but says they save enough to meet recommendations from the National Religious Retirement Office, which provides guidance tailored to the size and age makeup of religious communities.
How shareholder activism can be effective
Shareholder activism by smaller, non-institutional investors like the Catholic nuns has traditionally viewed by corporations as “small potatoes,” according to Andrew Baker, a law professor at the University of California, Berkeley who researches corporate governance issues. Even when their resolutions do occasionally succeed they’re typically precatory, or nonbinding.
“The classical view is that these (proposals) don’t matter very much,” he said. “But I don’t think that’s totally true.”
Baker said they can move the needle in less obvious ways: They bring attention to certain issues, sometimes drawing in larger, institutional investors, who hold much more influence. Several large firms have joined and started “ESG” initiatives in recent years — short for environmental, social and corporate governance issues — which has drawn its own criticism.
Sarah Haan, a law professor at Washington and Lee University, said the sisters’ work is part of a long history of shareholder activism by women, which dates back to the turn of the 20th century. More recently, the entry of large asset managers into the ESG investing space has created an environment where groups like the Benedictine sisters can have a greater impact.
“If you're corporate management, and you see that 49%, 40%, 35% of your shareholders all want you to do something,” she said, “you need to at least start thinking about that thing.”
Haan said the sisters’ ethical predicament reflects growing concerns of many Americans over a mismatch between their values and the actions of the companies their savings are invested in.
“The American retirement system is very dependent, through our 401(k)s, on the stock market. And you might have views about how your money is being used that are different from the views of the CEOs and the directors of these companies,” she said.
“How can you have your voice heard? That’s a question that people are really grappling with today.”
‘We’re not out to bankrupt the company’
These days, Sister Barbara McCracken directs the Benedictine sisters’ shareholder activism from her desk in the monastery’s business office.
The 85-year-old has spent her life protesting injustice. A few years ago, she was arrested for trespassing while protesting with the Poor People’s Campaign outside then-Kansas Secretary of State Kris Kobach’s office. She sees the proxy fights as a continuation of that activism.
“We’re trying to educate the boards of directors for these big companies,” she said, “but we’re also trying to educate other shareholders. And we’re trying to educate our own sisters about what’s happening in the world.”
She leafed through a list of resolutions from the spring — demanding that Netflix amend its code of ethics to bolster board diversity and Tyson conduct a third-party audit following alleged child labor law violations. They urged Verizon to release more information on its lobbying activities.
In an email to NPR, a Netflix spokesperson said its code of ethics already includes strong anti-discrimination, anti-harassment and whistleblower protections, and added that most shareholders opposed the nuns’ resolution. Tyson and Verizon did not respond to requests for comment.
The sisters are one of many religious groups involved in this work. McCracken works with the Benedictine Coalition for Responsible Investment to sign onto resolutions that align with the sisters’ values. They, in turn, work with the Interfaith Center on Corporate Responsibility, which coordinates shareholder campaigns around issues like equitable supply chains and workplace safety.
For McCracken, it’s a way to live out the principles of Catholic Social Teaching, which emphasizes the rights of workers and caring for God’s creation.
“We’re not trying to bankrupt the company,” McCracken said about the proposals. “We want them to develop some kind of social conscience — particularly regarding global issues, which includes the environment, and then low-wage issues and racial justice issues.”
When capitalism and Catholicism clash
Not everyone thinks shareholder activism is the best way to pursue Catholic values in the corporate world.
Michael Matheson Miller, a senior research fellow at the Acton Institute for the Study of Religion and Liberty, which argues for limited regulation of markets and companies, agrees with the Benedictine sisters on many issues. But he says many businesses already contribute to the common good simply through producing needed goods and services.
He thinks some shareholder resolutions serve as distractions for companies and ultimately raise costs for consumers. They might also be ineffective at achieving their aims if they force a company to enter a sphere of philanthropy where they don’t have expertise.
“(These resolutions) create a place where people get pressured,” he said, “to support all of these groups just to be left alone.”
Like the sisters, he thinks that businesses have a responsibility to act morally. But he says any effort to intervene in corporate operations must be balanced with the Catholic principle of subsidiarity: the idea that those closest to a given problem should be the ones to address it.
“It’s important to realize that the shareholder is not the manager,” he said.
“(Shareholders) may want to impose a certain vision of hiring or a certain vision of management that (they) think is very good,” he added, “but that would actually create harm to the employees, to the company culture, to shareholder value, and maybe even create other injustices.”
Living gospel values
A commitment to environmental sustainability pervades the Benedictine sisters’ monastery. Chickens cluck on its grounds and insects buzz in its gardens, where the sisters grow pumpkins, tomatoes and zucchini. A series of solar panels soak in the Kansas sun. Sister Delores Dolezal dumps a bucket of lemon peels into a compost pile — so rich in nutrients, she says, that they sometimes discover new melons growing in the soil before they can distribute it.
For the sisters, stewarding the earth’s resources responsibly is a Biblical imperative.
“In Genesis, human beings have been given dominion over creation, and that’s often misunderstood as a license to dominate and use and consume,” said Sister Elizabeth Carrillo. “But it means that human beings have a special charge of stewardship.”
She said that duty is only underscored by the acceleration of climate change.
“It can get overwhelming. Glaciers are melting. Seas are rising and getting warmer,” she said. “But even in the midst of that reality, there can be a lot of hopefulness in embracing that core vocation.”
After midday mass, the sisters gather for lunch. They sing happy birthday to their new postulant and celebrate with carrot cake. These days, they welcome, at most, one new member each year. It’s a vastly different picture than when older sisters like McCracken joined, in groups of a dozen or more.
As the monastery evolves, McCracken sees their shareholder activism as another way to invest in their ministry — while stewarding their resources so the community can persist.
“I’m very interested in looking at the future, rather than the past,” she said. “How do we live gospel values today in a radical way? To me, that’s one of our most basic questions.”
A question, she says, she’ll spend her life trying to answer.
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