State Treasurer Denise L. Nappier is ramping up her shareholder activism, joining critics of Caterpillar Inc. who are pushing the mining and construction equipment giant to exit Sudan.
Using the power of the state’s $26 billion retirement fund, Nappier on Wednesday threw her support behind a shareholder resolution calling on Caterpillar to make sure its foreign subsidiaries don’t do business with the government of Sudan.
“While Caterpillar, Inc. may not have offices or employees in Sudan, and may not sell any products directly to the government of Sudan, the fact that its foreign subsidiaries do business there is enough to trigger our concerns,” Nappier said in a written release. “As the company admits in its filing, had those sales been made by U.S. divisions they would have been in violation of U.S. law.”
Connecticut’s fund raised the issue of human rights abuses in Sudan as early as 2006, Nappier said, adding that the situation has not improved. In response to the genocide in Sudan’s Darfur region, Connecticut passed a law that year, at Nappier’s urging, that restricts investment in companies found to be doing business there.
Connecticut is also active in the Conflict Risk Network, a group of institutional investors with more than $6 trillion in assets, which has placed Caterpillar on its watch list.
As of May 13, the Connecticut fund held $14.4 million in Caterpillar stock and $158,000 in bonds, Nappier’s office said.
“The State of Connecticut should not condone, or even appear to condone, genocide,” she said.
As fiduciary of the fund, Nappier has often been an activist on social and humanitarian issues as well as corporate governance. She argues that her activism is part of sound financial management, helping assure that global companies adhere to accepted principles of management.