Pressing From a Different Angle

A group named Social(k) is applying pressure on Fidelity to divest itself of investments linked to Sudan. They are encouraging individual investors, and those whose 401(k) plans invest in Fidelity funds, to contact the mutual fund giant and demand they divest from any company whose activities might support the Sudanese government. In addition to that, Social(k) will publish the names of companies whose 401(k) plans have substantial assets invested by Fidelity. Verizon, Ford Motor and Eastman Kodak count themselves among the twenty-nine "major" companies on the list.

It will be interesting to see how the various targets of the pressure will react to this novel approach. Fidelity has declared their opposition to blanket divestitures. Individual participants are unlikely to have an immediate impact, leaving Plan Sponsors as the logical target of this approach.

News Articles [PLANSPONSOR.com] - Social(k) Calling for Retirement Plan Pressure on Fidelity: "Social(k) Calling for Retirement Plan Pressure on Fidelity
May 17, 2007 (PLANSPONSOR.com) – If your retirement plan has investments at Fidelity, you may soon be asked to help prod the mutual fund giant to divest itself of investments linked to Sudan.

Up till now, the call to pull pension fund investments has largely been limited to public pension plans, and at the instigation of lawmakers. However, Springfield, Massachusetts-based Social(k) - a socially-responsive 401(k) platform provider - has teamed up with an organization calling itself Fidelity Out of Sudan to…well, to help prod the mutual fund giant to divest itself of those investments."