Eco-nomics

INTEGRATIVE INVESTING
Why Your Values Matter in the World of Money



"The return on our investments is much, much more than a total sum of dollars. It is an expression of our character and integrity." -- Rebecca Adamson, President First Nations Development Institute and Calvert Social Investment Fund Trustee.

When making life decisions you act in accordance with your values and beliefs. Why is it different when you make investments? It needn't be. Voice an opinion for positive social change and help make it happen. Know your money doesn't finance businesses that harm any of us or our planet. Create a sound and sustainable future. Invest for profit with principles.

Investing in a socially and environmentally responsible mutual fund (for example) puts your money to work for a better world and a more just society. Eleven of the 44 socially & environmentally responsible mutualfunds returned more than 20% in 1996. The Green Century Balanced Fund topped the list with a total return of 25%.

The Greenmoney Journal provides relevant information on responsible investing and business. We believe that in-depth information on companies and their financial and social activities help large and small investors make informed decisions. We promote the ethical creation of financial independence.

Following are three key strategies toward this end:

  • Screen Companies: include or exclude their securities (stocks) from a portfolio or mutual fund.

  • Support Communities: invest in community development through responsible banks, loan funds, and credit unions.

  • Influence Corporations: use shareholder activism and resolutions to improve corporate behavior.

Information on Socially & Environmentally Responsible Investing (SRI) is now available around the world, day and night. The Internet's world wide web is an exciting medium for information exchange. Our web site, The GreenMoney Online Guide address is- www.greenmoney.com.

SRI is exerting a rapidly expanding financial presence. SRI moves forward with commitment, and competence while increasing its influence in the national and global economy. "Responsible investing is a disciplined investment strategy that begins with a traditional financial evaluation of a company's potential to deliver positive returns but goes one step further. Responsible investors also look to identify those companies that have a positive impact on the environment, the workplace and the community, and in this way improve ourquality of life." - Calvert Group

In this article, we take a in-depth look at SRI. We cover current screening, the world of SRI in 1996 and what's ahead in 1997. Also featured: community banking, shareholder resolutions, SRI publications and web sites. Also see the visionary article on the Future of SRI by Amy Domini, titled Social Investing, Economic Evolution or Revolution?.

SCREENS
Investment screening integrates your values and your money. Screen in the positive and screen out the negative. For example, do you want to avoid certain companies because of their products and corporate behavior? Do you want to be involved in shareholder activism using shareholder resolutions to change corporate behavior? What is the composition of a company's management and board of directors - are customers, community, employees, and shareholders represented?

Approximately half of the largest 1,000 publicly traded U.S. companies meet most socially responsible mutual funds screening criteria. There are now two SRI Indexes measuring performance against the overall market. First is the Domini 400 Social Index containing 250 companies from the Standard & Poors 500 (S&P 500). The second is the newer Citizens 300 Index containing 200 companies from the S&P 500. Are there performance sacrifices when investing in socially and environmentally responsible ways? No. Consider these numbers: The Domini 400 Social Index (DSI) was launched in May 1990 by Kinder, Lydenberg and Domini (KLD) to track 400 companies that pass multiple social screens. From May 1990 through December 1996, the DSI demonstrates the long-term profitability of SRI by returning 191.3% compared to 171.4% for the S&P 500. For 1995 and 1996, both socially responsible investing indexes outperformed the overall market. Here are the return figures for the three different market indexes: In 1995, Citizens 300 Index returned 40.1%, the Domini 400 Index 38.2%, the S&P 500 Index 37.5%. In 1996, Citizens 300 Index returned 26.2%, the Domini 400 Index 23.7%, the S&P 500 Index 23.1%.

POSITIVE SCREENS (Seek) +
Good labor relations, effective equal opportunity for women and minorities, management and employee diversity, employment practices, employee stock purchasing plan/profit sharing, worker health and safety, employee & family benefits, education and training programs, health care, child care, elderly care + Good customer relations, corporate openness & citizenship, community development & involvement, charitable giving, product safety and quality, human rights record, code of conduct for suppliers + Good environmental record, CERES Principles signatory (environmental standards), pollution prevention measures, conservation, renewable energy resources, recycling programs, natural & sustainable farming and food production + Other areas of attention - positive response to shareholder resolutions, financing for small business, affordable housing, products designed for recyclability, The Natural Step trainings, warranties, research & development, smoke-free workplaces & restaurants, financing libraries, hospitals, schools, mass transit, park development, open space acquisition.

NEGATIVE SCREENS (Avoid) -
Discriminatory labor and employment practices, lack of management and workforce diversity, excessive executive & board of directors compensation, poor response to shareholder resolutions, human rights violation record, business activities with repressive governments, defense & weapons contractors (military), unethical business practices - Poor environmental record/EPA Violators - water, air and land polluters, nuclear power, nuclear or biological weapons manufacturers, hazardous waste and agriculture chemicals, manufacturers and exporters - Alcohol, tobacco, gambling, use of animals in product testing - Other areas of attention - international labor sourcing, inappropriate advertising, violence in the media, personal weapons manufacturer, poor quality products, business activities in Burma, unrecyclable products, excessive waste, U.S. Treasury securities, Corporate PAC donations, violent toys or video games, numerous lawsuits, large workforce reductions.

Note: The list of social investing screens are used by screened mutual funds. For more information call any of the mutual funds on the chart [in the mutual fund section of the GreenMoney home page] and request a copy of their screening criteria. Also note in that section the social ratings and definitions of mutual funds, which have been provided by Franklin Research and Development. 1996 SRI Industry Highlights & Changes

* Green Century's Balanced Fund was the #1 performing socially responsible mutual fund in 1996 returning 25.0%. The fund ranked #2 among the 277 balanced funds tracked by Lipper Analytical Services and is managed by Jackson Robinson of Winslow Capital Management. The average return for all balanced funds in 1996 was 13.8%.

* The Meyers Sheppard Pride Fund was launched last June. The fund selects from 375 blue chips companies that provide domestic partner health benefits and have progressive (anti-discrimination) policies towards gays & lesbians. The fund invests in growth stocks for long-term capital appreciation and is managed by Shelly Meyers. Currently, the fund invests in about 50 companies: American Express, Ann Taylor, AT&T, The Limited, Silicon Graphics, Sprint, and Time Warner are included.

* Security Benefit Group (perhaps best known for its socially responsible variable annuity product) has launched the Security Social Awareness Fund. This capital appreciation fund employs both positive and negative screens and is managed by Cindy Shields. The Security Benefit company was chosen in 1995 & 1996 as one of the 100 Best Companies for Working Mothers by Working Mothers magazine.

* In 1996, the SRI community held two conferences: First, the Investors Pasquinade was held in Boston last May. Franklin Research and Development brought together business leaders, academics, policy makers and the SRI community. The conference featured an alternative transportation parade and presentations by twenty responsible public companies sharing their financial outlooks and social programs. Second, the annual SRI in the Rockies conference was held in Jackson,WY last September. First Affirmative Financial Network and the Social Investment Forum (SIF) put together the largest and most diverse SRI conference to date. Amy Domini, President of the Domini Social Equity Fund was presented with the 1996 SRI Service Award for her outstanding contributions to SRI. John Guerard, Director of Quantitative Research at Vantage Global Advisors was presented with The Moskowitz Prize for his financial research of SRI.

. * The Conscientious Investors Guide to Socially Responsible Mutual Funds and Investment Services was published by ICCR. The newly revised guide includes mutual funds, stockbrokers, portfolio managers and investment advisors. To order call (212) 870-2295.

* The Nightly Business Report (Public TV Program) had two commentaries on the merits of SRI. James Glassman of the Washington Post and Steve Schueth of Calvert Group were involved.

* TIAA-CREF Social Choice account is the largest pool of socially & environmentally invested money in the U.S. The fund manages over $1.6 billion in assets. The fund returned 15.5% for 1996 and since inception in March 1990 has averaged an annual return of 13.3%.

* The Natural Business newsletter was launched in 1996. This monthly newsletter provides in-depth coverage on business and financial news of the health/natural products industry worldwide. To order call (303) 442-8983.

* Whole Foods Market reported Fiscal Year 1996 sales of $892 million and aims for $1 billion in 1997. The company was featured in Fast Company magazine (April/May 1996). Other retail company news: Blue Fish Clothing, Annies Homegrown, Wild Oats Markets, EcoMat and Thanksgiving Coffee all went public to increase their visibility and sales. 1996 Related Events:

* Texaco's $176 million discrimination lawsuit settlement and tape scandal proves how discrimination harms companies, employees and shareholders. Though, the settlement includes the ground-breaking Equality and Tolerance Task Force - with a $35 million budget. Look for Texaco's new equal employment opportunity report later this year. Here is a quote from TexacoChairman and CEO, Peter Bijur (after the lawsuit settlement), "with this litigation behind us, we can now move forward on our broader, urgent mission to make Texaco a model of workplace opportunity for all men and women."

* The subject of diversity on Corporate Board of Directors got a lot of coverage in 1996. The main story was Sister Doris Gormley of the Sisters of St. Francis in Philadelphia who sends letters to CEOs around the country, urging them to consider qualified women and minorities for their boards. T.J. Rodgers of Cypress Semiconductor Corporation responded with a (negative) five-page reply. His letter and the debate made its way to The Wall Street Journal, Time magazine and CBS This Morning. Overall, responses to the letters were mixed but dialogue on board diversity was greatly enhanced.

* The Interfaith Center for Corporate Responsibility (ICCR) celebrated its 25th anniversary year. Inspired by faith and committed to action, ICCR and its members ignited an international movement producing critical changes incorporate decision making and expanding how faith communities carry out social and economic justice programs. ICCR has grown into an international coalition of Protestant, Roman Catholic and Jewish institutional investors including pension funds, healthcare corporations, denominations, orders and dioceses with combined portfolios worth an estimated $50 billion. They are committed to merging social values with investment decisions. ICCR members also make alternative investments to promote economic justice and positive development in low income and minority communities. ICCR members have alternative investments surpassing $300 million.

* President Clinton and Vice President Gore invited more than 100 CEOs to the White House for the (first-ever) Conference on Corporate Citizenship. Topics included safe and secure workplaces, balancing work and family as well as education and training. The administration named an award for (former Commerce Secretary) Ron Brown honoring corporate responsibility.

* NBC Nightly News did a story on companies with domestic partner benefits that help workers feel secure. They featured Ben & Jerry's, Apple Computer and Microsoft. Another show, featuring Xerox and American Express, examined sabbaticals with social conscience. Tom's of Maine's corporate citizenship also received NBC exposure. Additionally, Tom's of Maine co-founder Tom Chappell was featured in the December 22, 1996 issue of The New York Times Magazine.

* Odwalla (the fresh juice company) recalled all unpasteurized apple juice products due to an outbreak of E. coli last Fall. Since the outbreak, no clear source of the bacteria has been found by the FDA or Odwalla. The company has been praised for its quick and thorough recall response and complete openness to officials. For information on Odwalla's activities and new flash pasteurized/reformulated juices call (800)-ODWALLA or visit their web site at- www.odwallazone.com

* Worth magazine featured a cover story: Real Wealth: The Nature of Charity - Looking for a New Andrew Carnegie (November 1996). The article mentiones that a trillion dollar transfer of wealth will occur in the next generation and questioned: "how much will be given away?" In 1995, Americans gave about $140 billion to charity. The article also mentioned Tracy Gary and Resourceful Women. The San Francisco-based network comprised of over 80 women that have combined personal assets of $2 billion. The group gives an estimated $30 million a year to "socially progressive" causes.

MUTUAL FUNDS RETURNS

In 1996, Eleven of the 44 socially and environmentally responsible mutual funds returned more than 20%. Here are top funds with return:

  1. Green Century Balanced - 25.0%

  2. Dreyfus Third Century - 24.3%

  3. Ariel Appreciation - 23.7%

  4. Ariel Growth - 23.5%

  5. Citizens Trust Index - 23.1%

  6. Aquinas Equity Growth - 22.9%

  7. Domini Social Equity - 21.8%

  8. Calvert Social Equity - 21.7%

  9. Green Century Equity - 21.3%

  10. Aquinas Equity Income - 20.4%

  11. DevCap Shared Return - 20.0%

MUTUAL FUND NEWS
Many mutual funds and fund families accomplished a great deal in 1996. We feature those accomplishments which expand SRI. Highlighted funds include:Calvert, Citizens Trust, Domini, Dreyfus and Pax World.Calvert Group Funds

* In 1996, Calvert Group celebrated its 20th anniversary. They now manageover $1.5 billion in their family of socially and environmentally responsible mutual funds.

* The World Values Fund was changed from a Global to an International fund. It will now invest 95% of its $200 million in assets outside theU.S.

* Calvert's largest fund, Social Managed Growth Fund ($620 million) has a new money management team: Brown Capital Management, NCM Capital Management and Calvert Asset Management Company. Brown and NCM are two of the largest minority-owned money management firms in the U.S., each managing several billion dollars for institutional and individual clients.

* Eddie Brown (Brown Capital Management) co-manager of Calvert's Capital Accumulation Fund and Social Managed Growth Fund was inducted into the Investing Hall of Fame on Wall Street Week with Louis Rukeyser (Public TV program). He is first African-American inducted. Mr. Rukeyser stated that Mr. Brown is "one of the most eminent and talented advisors in the world of investing." * The New Vision Small-Cap Fund was launched in February 1997. The fund is managed by Cedd Moses, the manager of Calvert's Strategic Growth Fund. Mr. Moses of Portfolio Advisory Services recently appeared in Worth magazine's Investing Outlook 1997 and on CNBC. * An education campaign titled "Know What You Own" was kicked off in 1996. The campaign was launched with ads in the New York Times, Washington Post, USA Today, other publications and the internet. The campaign is designed to make people knowledgeable about stocks held in the mutual funds they own. The campaign is highlighted on "The Know What You Own" section of their web site at- www.calvertgroup.com. This resource allows anyone to find out about the top ten stocks in their mutual funds and if there are tobacco holdings.

* Calvert is offering a comprehensive action guide titled "Kicking the Habit: How to Get Your Money Out of Tobacco." The guide provides investors with information and tools to steer away from mutual funds that do not meet their social criteria - and helps employers find tobacco-free investment options in their retirement plans. Know what you own and order a copy call (800) 711-9437.

* The Point of Light Foundation presented Calvert with the "Award for Excellence in Corporate Community Service" for their commitment to community service and employee volunteer programs. Calvert also was presented with The Working Mothers magazine award as one of the 100 Best Companies for Working Mothers (for the fourth year in a row).

* The Citizens Trust family of mutual funds surpassed $410 million in total assets during 1996, an increase of $120 million for the year.

* The E-Fund was the #1 performing money market fund for total return among the 288 funds tracked by Lipper Analytical Services. The fund returned 5.96% for the one-year period ending 12/31/96. The E-fund was recently mentioned in Kiplinger Personal Finance magazine (February 1997).

* The Wall Street Journal Mutual Fund Score card on August 5, 1996 listed the Citizens Trust Emerging Growth Fund as the #1 overall fund for total return among 134 mid-cap funds tracked by Lipper Analytical Services for the one-year period ending 7/31/96.

* The Wall Street Journal gave Citizens Trust Income Fund an "A" ranking, for it's top 20% return performance among comparable bond funds.

* Citizens Trust Index Fund celebrated its one year anniversary on March 3, 1996 returning 26.2%. For 1996, it returned 23.1%.

* The $12 million Muir California Tax-Free Income Fund celebrated its fifth anniversary in 1996.

* Money magazine (May 1996) asked for 22 top stocks picks from America's best money managers. One of the management teams chosen was Gail Seneca, Ron Jacks & Rick Little of GMG/Seneca Capital Management. This team is the sub-adviser and fund manager for several of the Citizens Trust mutual funds including the Working Assets Money Market Portfolio, the E- fund, Muir Calif. Tax-Free Income, Citizens Income, and Emerging Growth.Domini Social Equity Fund.

* The Domini Social Equity fund celebrated its fifth anniversary in 1996. Assets now exceed $110 million, an increase of $50 million in the last year. The fund has an average annual return of 14.4% for the five year period ending 12/31/96.

* The Domini Social Equity fund was first to publish their overall Social Screening Criteria and Proxy Voting Guidelines. The 1996 booklet covers the following topics: community, diversity, environment, employee relations, products, and non-U.S. operations as well as complete information on their proxy activities. To order a copy call (800)762-6814.

* Morningstar added Domini Social Equity fund to its 401(k) retirement plan for its own employees.

* Money magazine (May 1996) Fund Watch column selected the Domini Social Equity as its fund of the month.

* Worth magazine (November 1996) Rated 719 equity mutual funds that have a five year track record and assets of at least $50 million. In the article they listed eight SRI funds and gave only one of the them 3 stars out of the possible 5 stars, the Domini Social Equity fund.Dreyfus Third Century Fund.

* Dreyfus Third Century Fund is celebrating its 25th anniversary this year, the $600 million fund was the #2 SRI fund in 1996 with a return of 24.3%.

* During 1996, Eric Steedman was named as a portfolio manager for the fund and is primarily responsible for the management of the fund's social responsibility criteria. Mr. Steedman was also recently elected to the Board of the Social Investment Forum.

* The sub-adviser and fund manager is NCM Capital Management. NCM is one of the nation's largest African-American owned investment firms managing over $2.3 billion in assets. NCM is led by Maceo Sloan. Mr. Sloan was a keynote speaker at the 1996 BSR conference in New York. He talked on principle-based and values-centered investing as well as the importance of fund managers having dialogue with a company's management to influence their decision making process.

* Dreyfus Corporation has included the Third Century fund (their only socially responsible fund) in several large ad campaigns. Recent print ads focused on their highest performing equity funds. The ads appeared in Money, Bloomberg Personal, Worth, USA Today and The Wall Street Journal.

* The $535 million Pax World Fund was sold to the Shadek family of New Jersey in 1996. The family has securities industry, financial management, advertising and marketing experience. Current Pax President Luther Tyson and portfolio manager Anthony Brown will continue with the fund. PaxWorld's new Chairman, Lawrence Shadek stated "shareholders will see a younger management seeking to improve performance and, at the same time, sustaining the present socially responsible criteria."

* The Shadek family has committed to launching several new funds, expanding Pax to a family of funds. Look for a new equity growth fund this Spring and additional funds later in 1997 and 1998.

* Fortune magazine Investor's Guide '97 named Pax World fund as one of the best mutual funds for your money now. They listed the fund #2 out of 25 balanced funds chosen. The funds listed were "the consistent top performers that will help you reach your financial goals."

* Bloomberg Personal magazine (Nov./Dec. 1996) named Pax World fund as one of the top five balanced mutual funds. They rated the funds on 1 and 3 years returns, as well as their loads and fees. Note: To learn more about investing in any of the funds, please call them and request a current prospectus and annual report. The annual report will help you understand their investment philosophy as well as their social, environmental, and financial objectives (For a complete list of responsible mutual funds, see the chart in the mutual fund section on the GreenMoneyhome page).

* Several new screened mutual funds will be launched this Spring: The Cruelty-Free Value Fund from Beacon Global Advisors [February], The Calvert New Vision Small-Cap Fund [February], The Delaware Quantum Fund [February], The MMA Praxis International Fund [April], Pax World Growth Fund [April], and a screened Balanced Fund from Smith Barney/Greenwich Street Advisors [April].

* SRI articles to date in 1997: The best screened mutual funds - Business Ethics Reports (Jan./Feb.), Fund managers stock picks for 1997 - Franklin's Insight (January 15), Ethical economics with Hazel Henderson - Wired magazine (February). Articles coming up in 1997: Paul Hawken on Natural Capitalism and the Next Industrial Revolution - Mother Jones magazine (March/April), Socially Conscious Investing - Vegetarian Times magazine (April). The new Shore Trust community development Bank in Washington state - Fast Company magazine (April/May), Getting start with Socially Responsible Investing - Green magazine (Spring), Social Investing resources - Whole Earth Review (Spring).

* A new SRI conference is scheduled for July 22-23 at the Crown Plaza Hotel in New York City. The theme: Making a Profit, While Making a Difference. The conference is presented by Capital Missions Company and the Strategic Research Institute. For more information on attending call (630) 876-1101.

* The annual SRI in the Rockies conference is scheduled for September 11-14 at the Big Sky Hotel in Big Sky, Montana. The conference is presented by First Affirmative Financial Network (FAFN) and the Social Investment Forum. For more information on attending call (888) 774-2663 or visit the First Affirmative's web site at- www.greenmoney.com/fafn.


COMMUNITY DEVELOPMENT BANKING
Following the lead of South Shore Bank, Vermont National Bank, and Self-Help Credit Union, new community development banks and credit unions are opening around the country. These financial institutions are designed to fill the credit needs of local residents and nonprofit community organizations. Customers and members get help buying homes, and starting or expanding businesses. (See the chart of financial institutions in the bank and credit unions section on the GreenMoney home page).

* Albina Community Bank completed its first year in Portland, OR by supporting the values of business discipline and economic opportunity for all. The bank received over $16 million in deposits and wrote $9 million in loans during 1996.

* The Community Bank of the Bay in Oakland, CA opened in 1996. The bank received over $5 million in deposits during its first six months.

* Self-Help Credit Union & Venture Fund co-founder Martin Eakes was given a genius grant by the MacArthur Foundation. The $260,000 grant was given to Mr. Eakes for "creating an economic development program that combines hard-core business principles with self-help strategy." Self-Help has assisted the rural poor in North Carolina to obtain $90 million in loans to start businesses and buy homes.

* The Community Capital Bank of Brooklyn, NY was presented with the 1996 Treasury Department's Bank Enterprise $215,000 Award for Community Development Financial Institutions.

* The first community development bank in Washington state will open this Spring. The Shore Trust Bank is the result of a partnership between Ecotrust and South Shore Bank (SSB). Their goal is to promote community development and create good jobs while conserving the environment. The funds invested in Eco Deposits at SSB are targeted for the Shore Trust Bank and will be transferred when the bank opens.

SRI ONLINE [Greenspace in Cyberspace]
The Internet brings global accessibility to SRI information. Our website, The GreenMoney Online Guide is being accessed from all over the world, with an average of 16,000 hits per week. The major net search engines including: Yahoo, Webcrawler, and Alta Vista all have a socially responsible investing category making the information search easier. (See the list of web sites on page 23).

* In 1996, GreenMoney Online Guide joined forces with Good Money Online to launch a third, more comprehensive SRI web site called SRInvest. The site was given the 3-star web site award from Mallegan. Recently, all three sites were mentioned as web resources in a SRI article in the San Francisco Chronicle. Visit the SRInvest web site at- www.tbzweb.com/srinvest.

* Social Investment Forum members have an online SRI discussion group. It is a virtual community of thoughts, ideas, issues and SRI practices. For more information contact coordinator Eric Smith of KMS Financial Services by e-mail at-erics@goodfunds.com

* More of the SRI community launched new web sites in 1996 including: PaxWorld Fund, Calvert Social Investment Fund, Calvert Venture Partners, Co-op America, DevCap Fund, Franklin Research & Development, Social Investment Forum and others. The Pacific Stock Exchange created an SRI section in their site on America Online. Also Real Goods became the first company toget SEC approval to trade its stock by using their internet site at-www.realgoods.com.

* We found SRI articles throughout the internet. Mutual Funds magazine online and Kiplinger Personal Finance magazine online have articles. Also on CnnFn: the Financial Network Online has a Dollars and Social Sense article questioning if Wall Street can invest your money without offending your morals - their answer, it depends. They also did a more recent online article about SRI mutual funds. Also see the online magazine, A Better World for numerous SRI articles.

ORGANIZATIONS
* The Social Investment Forum (SIF) is a nonprofit membership organization dedicated to promoting the concept, practice and growth of SRI. The membership includes individual investors, investment professionals, financial institutions, research organizations, foundations, community development organizations and public educators. More mainstream institutional investors such as universities, insurance companies, religious and medical institutions are becoming involved. Currently, the Forum has over 400 members.

* In December 1996, the SIF and joint membership partner Co-op America Business Network launched their Tobacco Investor Education program with a Research Paper entitled "Tobacco's Changing Context: A Challenge andOpportunity for Institutional Investors." This ground-breaking report summarizes all the key issues for institutional investors in the area of tobacco stocks. The main focus is on tobacco holdings of the 15 largest mutual funds, of which ten hold tobacco stocks. Institutional investors manage large amounts of money for public and nonprofit pensions and 401(k)plans, insurance companies, universities, foundations, hospitals, churches and synagogues. The report costs $59. You can obtain a copy by calling (202) 872-5304. Highlights of the report are on the SIF web site at-www.socialinvest.org.

* The 1997 Social Investment Forum Member Directory: A Guide to Socially Responsible Investing Services is now available. The newly updated and redesigned Directory comes with Co-op America's Financial Planning Handbook for Responsible Investors. For more information on membership, a copy of their Connections newsletter or to order the Forum Directory call (202) 872-5319 or visit their web siteat- www.socialinvest.org.TOBACCO [Do you want to invest in this?]

* Surgeon General's Warning: Smoking Causes Lung Cancer, Heart Disease, Emphysema, and May Complicate Pregnancy.

* 1996 saw more states begin lawsuits against the tobacco companies. There are now 19 states trying to recover Medicare expenses associated with tobacco-related illnesses. Several state pension funds are divesting or limiting any new purchase of tobacco stocks.

* 3M decided to no longer accept tobacco ads for its billboards.

* Knight-Ridder created a set of guidelines for placing tobacco ads in its newspapers and publications.

* In February 1996, Co-op America released its findings on the amount of tobacco stocks contained in the 15 largest mutual funds in America. Ten of the 15 had tobacco stocks among their holdings. Taken together, the tobacco holdings of the largest funds added up to $3 billion. In April1996, the American Medical Association (AMA) used Co-op America's research to call on Americans to divest of tobacco. The AMA called on investors (large and small) to divest stocks of companies that manufacture and distribute tobacco as well as from the 1,474 mutual funds which invest intobacco companies.

* Co-op America's tobacco and toxics media campaign included over 200 newspapers, radio and TV programs ranging from the New York Times to the Los Angeles Times and from NPR to CNN. To find out if you own any of the worst tobacco or toxic laden mutual funds call (800) 58-GREEN and request the Fall 1996 issue the Co-op America Quarterly. That issue of CAQ is titled- Warning: Your Investments May Be Hazardous to Your Health, FromToxics to Tobacco. The main article includes a list of tobacco-free investments.- In a survey of 800 mutual fund investors - [Source: Yankelovich Partners and Calvert Group] 66% did not know if their mutual funds invested in tobacco, 59% prefer not to be invested in mutual funds with tobacco, 35% said they switch mutual funds if they knew, 69% said they want a SRI option in their existing retirement portfolio, 83% believe their brokers should know how they feel about issues of corporate social responsibility before making investment recommendations

SHAREHOLDER RESOLUTIONS & ACTIVISM
* This Spring, socially concerned investors have an opportunity to send a message to management and use their economic power by voting their proxies. Companies now include in their proxy statements shareholder resolutions on the environment, employment discrimination, human rights overseas, race and gender diversity on boards and many other issues. Read your proxies and vote for these resolutions. By doing so you vote for your conscience and let management know that you want them to improve their records on these important social justice issues. Co-op America recently stated, "Shareholder activism is among the most powerful tools available to socially concerned investors. As owners of the corporations, shareholders can influence management in a variety of ways. Through sponsorship and support of social proxy resolutions investors have a unique chance to help redefine shareholder values."

* Shareholder resolutions for the 1997 proxy season will include: Board diversity, Environmental issues, CERES Principles, Equal employment opportunity, Executive compensation, Workplace & Labor issues (sweatshops), Human rights, Burma, Nigeria, China, and Tobacco. There are fifty tobacco-related shareholder resolutions expected to be filed in 1997. Tim Smith, executive director of ICCR recently stated, "the tobacco debate certainly has the potential for becoming as powerful as the South Africa divestment issue."

* For more information on shareholder resolutions and activism contact the Interfaith Center on Corporate Responsibility (ICCR) which publishes a newsletter, The Corporate Examiner and an annual Proxy Resolutions Book, to order call (212) 870-2295. Also contact the Investor Responsibility Research Center (IRRC) which publishes a newsletter, The Corporate Social Issues Reporter and a Corporate Governance Bulletin: Covering Shareholder Issues worldwide, to order call (202) 833-0700.

CLOSING
In closing, work towards financial independence. Take steps to make that possible.

Short Term Goals: First define financial independence for yourself. Make a plan. Get out of debt. (Pay off short-term credit cards, etc.). Start investing. Become conscious of why your dollars go where they go and what they bring back.

Long term Goals: "Right size" your life. Acknowledge the connection between your lifestyle choices and environmental enhancement or degradation. Move towards paying off long term debt (cars, homes, etc.). Create more time. Simplify financially, mentally, emotionally, and spiritually.

Note: For a more spiritual approach to money, see Tricycle: The Buddhist Review magazine (Winter 1996). There is a special section on money, called The Mirror of the Mind: How Money Can

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