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Monday, March 03, 2003|
Directors Are Next on AFL-CIO List
The AFL-CIO's interest in the fund industry did not cease when the SEC approved the new proxy-voting disclosure rules. In fact, the union may just have gotten started. The revelation was made this morning by Richard Trumka, the AFL-CIO secretary-treasurer, in an interview with the Wall Street Journal. The high-profile attack by the union comes at the same time that Rep. Michael G. Oxley (R-Ohio) has told the media that 2003 will be the year of the fund in his committee.
Like Oxley, Trumka told the paper that the AFL-CIO is seeking more disclosure of fees in the fund industry and of possible conflicts of interest. The union is also planning to rate funds based on how they vote on union-sponsored proxies.
Trumka also told the paper that the AFL-CIO approached Fidelity for its cooperation before the union started to lobby the SEC. Rather than partner with the union, Fidelity ignored it. "[They] looked me square in the eye and said, 'We will never disclose'," Trumka told the paper.
"I thought as smart businesspeople, they would make a smart business decision and say investors have a right to know this. This is important information. It should be part of what we provide to them. We should tell them what our fees are. We should tell them what our risks are. We should tell them how we vote our proxies. Because that's their money and they have a right to know. They could have taken that and marketed it," he added.
Trumka added that the union would likely look at how funds elect and nominate directors. "These are the people who are supposed to be looking out for our interests. So we would like to see more transparency and have more ability to nominate directors to those boards," he said.
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