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Rating:Tech Giants Targeted by Fund Firm Not Rated 0.0 Email Routing List Email & Route  Print Print
Thursday, June 13, 2002

Tech Giants Targeted by Fund Firm

by: Sean Hanna, Editor in Chief

Citizens Funds has filed shareholder resolutions at Microsoft and Cisco aimed at removing auditor conflict of interest and ensuring the integrity of the companies' financial results. Citizens is a specialist in distributing and creating socially responsible funds.

This type of action is not a new one for Citizens. Since 1997, it has filed approximately 30 resolutions on issues covering board diversity, the environment and workplace conditions.

The resolutions call on management at the two Fortune 500 companies to restrict the consulting fees paid to auditors to no more than 25 percent of total fees. The fund firm claims that Deloitte & Touche earned more then 75 percent of its total fees at Microsoft in 2001 and that PwC earned more than 90 percent of its fees from non-audit services at Cisco.

"Citizens Funds is committed to investing in companies that perform well, are fundamentally strong and that are also socially responsible. Corporate governance is one place where fundamental and social investing criteria intersect, so we must take action," said John Shields, president of Citizens Funds. "The investing public needs to be able to trust that auditors are unbiased and unfettered by potential conflicts of interest. So-called independent auditors need to shed their consulting services if they want the public to have faith in their findings."

He added that the firm's focus as a provider of socially responsible products makes it shareholder activism one of its priorities and part of its mission.

"We continually monitor companies in our portfolios to make sure they stick to ethical behavior and act in shareholders' best interests. We're concerned with issues ranging from truth telling, transparent bookkeeping and avoiding auditor conflict to product quality and safety, environmental practices and global labor policies," said Shields.  

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