Newsline Special for February 28, 2007

1) Church of the Brethren webcast series is launched.
2) Brethren Benefit Trust and Boston Common celebrate Aflac’s decision to give shareholders a say on pay.

To receive Newsline by e-mail or to unsubscribe, go to For more Church of the Brethren news, go to, click on “News” to find a news feature, more “Brethren bits,” and links to Brethren in the news, photo albums, and the Newsline archive.

1) Church of the Brethren webcast series is launched.

Webcasts–sometimes called “podcasts”–are now being offered through a joint project of several Church of the Brethren agencies and Annual Conference. Sponsors include the Association of Brethren Caregivers (ABC), Bethany Theological Seminary, Brethren Benefit Trust (BBT), the Church of the Brethren Credit Union, the General Board, and On Earth Peace.

Initiative for the project came from Bethany Seminary, which is hosting the webcasts at, with impetus from Enten Eller, the seminary’s director of Distributed Education and Electronic Communication, who is serving as executive producer for the webcast series.

Every two weeks, coinciding with each issue of Newsline, new audio webcasts will be offered featuring information from one of the agencies or from Annual Conference. Webcasts may be listened to online using most computers by visiting, or they may be downloaded and played on an MP3 player or iPod. Free subscriptions (through an RSS feed) are also offered. Newsline will include announcements of the topics of webcasts as they become available. For more information, visit the cobwebcast website listed above.

Today’s inaugural webcasts are about BBT’s socially responsible investment (SRI) ministry. Interviews with Eller and Nevin Dulabaum, BBT’s director of Communications and interim director of Socially Responsible Investing, and Dawn Wolfe of the staff of Boston Common Asset Management, tell the story of how BBT-owned shares helped launch a landmark move by insurance company Aflac, the first US corporation to give shareholders a nonbinding vote on executive compensation. Included is additional information about the extent and details of BBT’s SRI ministry and advocacy work, SRI events coming up at this year’s Annual Conference, and the encouragement given by last year’s Annual Conference for Brethren members to review their own investments.

For more information go to, or contact Enten Eller at Bethany Theological Seminary, 615 National Rd. W., Richmond, IN 47374; 800-287-8822 ext. 1831; or


2) Brethren Benefit Trust and Boston Common celebrate Aflac’s decision to give shareholders a say on pay.

It was a quack heard ’round the business world.

On Feb. 14, Aflac Incorporated, the insurance giant famous for using a duck in its television commercials, announced that its board had approved a resolution making it the first major US company that will give shareholders an advisory vote on the compensation it pays its executives.

It was Brethren Benefit Trust’s shares as an Aflac investor and advocacy work by Boston Common Asset Management that helped prompt Aflac into agreeing to give its shareholders such a vote.

“This is a landmark decision pertaining to an issue of justice,” said Nevin Dulabaum, BBT’s director of Communications and interim director of Socially Responsible Investing. “It is common to think of unfair wages being paid in developing countries, but one does not have to look beyond the US border to find salary and benefits inequities that rise to the obscene.”

In 1962, chief executive officers earned, on average, 24 times that of the average hourly worker, according to an Economic Policy Institute study. In 2005, the ratio of CEOs’ pay within the US to that of the average worker had skyrocketed to 262 to 1.

One of the recent jaw-dropping examples of compensation disparity was Home Depot’s Robert L. Nardelli, who resigned as chairman and chief executive at the beginning of this year, taking with him a “golden parachute” retirement package worth in excess of $200 million. During Nardelli’s six-year tenure, he received an additional $200 million in compensation and perks. Although revenues grew 12 percent each year and profits doubled during that timespan, the company’s total return to shareholders was down 13 percent.

The issue with Aflac actually began last October when Brethren Benefit Trust and Boston Common Asset Management co-signed a letter with the 275-member Interfaith Center on Corporate Responsibility (ICCR) that was sent to about 150 large firms. The letter asked for shareholders to be given a “say on pay,” that is, the opportunity to cast advisory votes on their respective company’s executive compensation report.

“We believe that there are real and significant concerns about excessive executive compensation practices that call for investors to become actively involved,” the letter stated. “In some cases, escalating executive compensation appears to bear little relationship to company financial performance. Additionally, consultant-driven compensation recommendations that advocate for top-tier pay packages create a spiraling-up effect. These concerns are amplified against a backdrop of stagnant wage growth for the average employee.”

ICCR staff subsequently identified firms that did not respond to the letter and asked its member organizations to engage in dialogue with one or more of the companies. Boston Common picked Aflac, which long had been held in the BBT portfolio. Boston Common is one of BBT’s eight investment managers and works closely with BBT on a number of socially responsible investing initiatives.

Dawn Wolfe, a social researcher and shareholder advocate for Boston Common, twice attempted to contact Aflac. Receiving no response, Boston Common used BBT’s Aflac holdings to file a shareholder resolution to pressure the firm into giving shareholders a nonbinding say on pay.

“They were very surprised to receive the resolution from us,” Wolfe said. “One of the reasons was that they believe they have exemplary practices when it comes to pay-for-performance, and so they believed our filing of the proposal was essentially unwarranted.” Over the span of about a dozen phone conversations and many e-mails, Boston Common learned of the metrics the insurance giant uses in establishing its executive compensation. Top Aflac officials, in turn, learned that the firm had not been targeted because they had a severe divergence between pay and performance, but because Boston Common believes shareholders have the right to express their views on executive pay.

The Aflac board ultimately decided to allow the shareholder advisory vote on executive compensation, but not until 2009 when new executive compensation disclosure rules by the Securities and Exchange Commission will be fully implemented. Being the first Fortune 500 company to make this decision, the announcement made major headlines. The story received page one coverage from “USA Today,” and was picked up by National Public Radio’s “Marketplace,” the “Chicago Tribune,” the “Washington Post,” and a number of other national, regional, and local media outlets.

“Aflac is the first major US company to agree to allow its shareholders to voice their opinions with regard to the firm’s executive compensation,” Dulabaum said. “Shareholder advocates nationwide hope that Aflac’s move will prompt other companies to agree to such nonbinding votes as well.”

All companies make decisions as corporate citizens as to how they treat their employees, their suppliers, and the environment. “I think it is important for shareholders to ask their firms to do more because these businesses impact our lives in so many ways,” Wolfe said. “We need to hold them to high standards.”

The task can be daunting. Those who engage in socially responsible investing initiatives can find the work to be long and tedious with often little to show from the endeavor. That is why Boston Common and BBT celebrate Aflac’s decision. “I think it’s a great story, what BBT’s ownership in Aflac enabled Boston Common to do,” said Wolfe. “Without BBT’s consent to use its shares, we would not have been able to file the resolution that led to Aflac agreeing to allow shareholders to vote on a nonbinding executive compensation resolution.”

BBT manages $415 million for more than 5,000 Church of the Brethren Pension Plan and Insurance members and Brethren Foundation clients. All of these funds are invested in a socially responsible manner, with investment screens and activist initiatives guided by Church of the Brethren Annual Conference statements and guidelines.

For more information contact Jay Wittmeyer, Church of the Brethren Benefit Trust, 1505 Dundee Ave., Elgin, IL 60120; 800 746-1505;


To receive Newsline by e-mail or to unsubscribe, go to Newsline is produced by Cheryl Brumbaugh-Cayford, director of news services for the Church of the Brethren General Board. Contact the editor at or 800-323-8039 ext. 260. Nevin Dulabaum contributed to this report. Newsline appears every other Wednesday, with the next regularly scheduled issue set for March 14; other special issues may be sent as needed. Newsline stories may be reprinted if Newsline is cited as the source. For more Church of the Brethren news and features, subscribe to “Messenger” magazine, call 800-323-8039 ext. 247.


[gt-link lang="en" label="English" widget_look="flags_name"]