Wednesday, April 11, 2007

Berkshire Agrees to Hold First U.S. Shareholder Vote on Sudan

From Institutional Shareholder Services Corporate Governance Blog, April 11, 2007:

Shareholders at Berkshire Hathaway will vote on a Sudan divestment proposal in May--the first time a socially responsible investing (SRI) proposal regarding the violence-beleaguered African country will be on the proxy at a U.S. company.
The proposal, submitted by stockholder Judith Porter, asks the company to consider divesting its shares in PetroChina, a Chinese oil subsidiary whose parent company has mining, refinery, and pipeline operations in Sudan.
Porter, who owns 10 class-B Berkshire shares, wants the company to stop investing in "any foreign corporation or subsidiary thereof that engages in activities that would be prohibited for U.S. companies by Executive Order of the President of the United States."
Since 1997, U.S. firms have been forbidden to operate in Sudan, but the law says nothing about investment in foreign companies that conduct business there.
Berkshire originally obtained permission from the Securities and Exchange Commission to exclude the proposal on the grounds that the wording was "vague and indefinite." However, Berkshire Chief Executive Warren E. Buffett, who has said that he opposes the proposal, decided to put it on the proxy at the company's May 5 annual meeting to assess investors' views on this issue.
Berkshire management said in a Feb. 21 statement that PetroChina does not do business in Sudan. However, Berkshire acknowledges that PetroChina's parent company, the China National Petroleum Company (CNPC), does.

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