David versus Goliaths
Lone shareholder cuts away at the business-abortion alliance
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Corporate giving to charity is as old as America itself. Benjamin Franklin was a great organizer of charities-including the nation's first volunteer fire department and the first charity hospital. Franklin, one of the richest and most prominent men in America, was also an expert at encouraging other business leaders to "dig deep."
Today, some corporations still "dig deep," but much of their giving goes to organizations that Franklin could not have imagined. J.P. Morgan Chase & Co., for example, contributed more than $500,000 to Planned Parenthood, the nation's largest performer of abortions, between 1998 and 2006.
But one man, Tom Strobhar, has spent nearly two decades applying the brakes to this corporate social engineering machine. With shareholder activism, Strobhar has had a hand in changing the corporate giving policies of more than 150 companies, essentially depriving Planned Parenthood of donations that would have totaled multimillions of dollars.
The tool of choice for Strobhar, who describes himself as "just a stockbroker from Dayton, Ohio," is the shareholder resolution. In order to introduce a shareholder resolution, a shareholder must own stock in the company valued at $2,000 or more for at least one year prior to the introduction of the resolution. Since 1991, Strobhar says he has introduced more than 60 such resolutions. He mostly introduces them himself. In some cases, he has written the resolutions for others. "Some of these companies are so bad I don't want to own them, so I find someone who does," he said.
The resolutions, Strobhar admits, have little chance of passing. Indeed, none of them have so far. But that doesn't mean the effort has been futile. AT&T was giving $50,000 a year to Planned Parenthood when Strobhar began his activism at the company. The company had received thousands of letters from customers, but to no avail. It was only when Strobhar threatened the introduction of a shareholder resolution, suggesting that the company was in "breach of fiduciary responsibility," that AT&T paid attention. Within months, AT&T announced it would no longer contribute to Planned Parenthood. "They had received thousands of letters," Strobhar said, "but working through the shareholder resolution process has a way of focusing their attention."
General Mills and American Express also stopped giving to Planned Parenthood following shareholder resolutions introduced by Strobhar. But Strobhar said his biggest success was at Berkshire Hathaway, whose legendary leader Warren Buffet is also infamous in pro-life circles. In 2001, 60 percent of the $33.4 million given by the Buffet Foundation went to what Strobhar calls "anti-life stuff," including Planned Parenthood and Catholics For A Free Choice. Strobhar attended the 2001 annual meeting to protest, and by July 2003 the foundation changed its policy, citing "harmful criticism" directed toward the company.
These changes encourage Strobhar. "These are big corporations," he said. "The directors and executives often don't know what's going on. That's the beauty of this process: It educates them, and it makes the executives think about these matters and take responsibility for what their companies are doing. And sometimes, they even change their minds."
Causing one to wonder: If a single stockbroker from Dayton, Ohio, can change the behavior of Warren Buffet and other corporate titans, what might a concerted, well-funded effort accomplish?