Fidelity fund shareholders reject 'genocide-free' plan
Shareholder proposals that would have barred two Fidelity Investments mutual funds from holding assets in companies tied to genocide were defeated, officials announced at the funds' annual meeting this morning in Boston.
The proposals were part of an effort by activist to bring attention to atrocities in Sudan. Fidelity's fund trustees had opposed the measures, arguing that investment decisions should lie with fund managers. While the vote went in Fidelity's favor, activists said their measure received an unusually high number of votes compared to campaigns on social and environmental causes at other companies. They predicted similar measures would receive a rising level of support as other Fidelity funds hold votes this spring.
"We expected to lose, but by a much wider margin,'' said Eric Cohen, chair of Investors Against Genocide, one of the groups that had backed the measure.
Only one fund trustee, Dennis J. Dirks, appeared in person at the small meeting, held at a Fidelity building adjacent to South Station. Dirks, 59, retired as chief operating officer of The Depository Trust & Clearing Corp. in 2003 and has served as a member of the 11-person Fidelity funds board since 2005. The gathering included about 30 other activists, shareholders, and company employees, including Fidelity general counsel Eric Roiter. Dirks and Roiter said the issue has been widely discussed internally, but said management must respect the wishes of all fund shareholders based on voting totals.
At the meeting the proposal received 27 percent of votes cast among holders of Fidelity's Capital & Income fund and 28 percent of votes cast among holders of Fidelity Health Care Portfolio fund. Voting results for other funds including Fidelity's well-known Contrafund were postponed as not enough votes were cast, executives said.
Fidelity had previously disclosed in filings that its managers had sold the majority of shares they once held in companies targeted by the activists including a pair of Chinese oil companies providing royalty payments to Sudan's government. The regime in Darfur has been widely accused of human-rights abuses.
(By Ross Kerber, Globe staff)
