Making Pension Investments Work for Participants

It’s no secret that shareholders can have a significant influence on company actions. As shareholders—owners—of roughly one-third of corporate America, Taft-Hartley Plans such as BAC pension plans can have a great deal of influence. Shareholders—union pension funds—have an obligation to use this influence to make sure that companies act in the best interest of the pension fund’s participants, in our case BAC members.

Greg Kinczewski addresses trustees on shareholder rights and proxy voting.

The BAC’s Proxy Voting Service provides a means for BAC pension funds to weigh in on corporate activities, including the type of labor used on their construction projects. It enables us to:

• contact large, publicly-traded companies who are uncertain about using signatories to collective bargaining agreements for their construction projects; and

• educate companies that using such signatories is in the best interest of shareholders because it is the best way to ensure that projects will be done on-time, on-budget, and with minimal need for repairs.

Proxy voting helps protect the value of BAC’s investments and increases our leverage with corporations. “Using our pension power wisely is critical to the financial health of our pension funds, the well-being of union members, and union industries,” President John J. Flynn told trustees at the 2001 BAC/ICE Benefits Conference. “That’s why we feel strongly that fund trustees have a duty to use the collective strength of their pension investments to further the interests of
plan participants and the long-term health of our funds, and to
give careful consideration to the role our pension investments play in the financial markets.”

Scores of projects have been turned around in the past few years because of these educational efforts. The success of this program, however, depends on BAC Locals keeping the international staff informed of what companies’ projects are of concern. It is the input at the Local level that triggers everything else. Greg Kinczewski of the Marco Consulting Group, which handles BAC’s investments, told Conference attendees, “We’re relying on you folks out there in the field. To make the process work, we need the people at the Local level that are dealing with these companies to tell us what’s going on and where we can help.”