The Stock Market Weapon

In Paul Driessen’s book, Eco-Imperialism, Driessen explains how green organizations frequently use the stock market and investing strategies to pressure companies into pursuing green policies. Sometimes, those efforts raise questions as to whether the organizations are acting ethically.

Driessen states that organizations will endeavor to own enough shares in companies so they can introduce resolutions designed to motivate the company to pursue certain initiatives. On the issue of the environment, green organizations that want to see more action to prevent manmade catastrophic global warming, for example, will own shares in companies that are actively pursuing policies that supposedly contribute to global warming so that the organization has a chance to steer the company towards more eco-friendly business practices.

The problem is that these green groups will also own shares in businesses that would benefit from more companies pursuing eco-friendly policies. Driessen points out that one group, Green Century, owned shares in Campbell’s Soup, and introduced a shareholder’s resolution to petition the company to stop using genetically modified ingredients. Two of Green Century’s largest holdings, however, are with Whole Foods and United Natural Foods, companies known to specialize in natural and organic foods. It raises conflict of interest questions as to whether it is ethical for an organization to own shares in one company and pursue policies in the name of ‘social responsibility,’ when other companies the organization owns shares in would benefit financially from those decisions.

Eco-Imperialism addresses a series of suggestions in order to shed more light on the process of such groups and their investment strategies. One of those solutions is to require non-profits to provide full disclosure of their operations, incomes, and expense reports. These are the same requirements they demand of for-profit companies. When both non-profits and for-profits are playing the stock market game, it is common sense to hold them to the same standards.

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