MAC: Mines and Communities

Cref Claims Ignorance of Gold Mining Controversies

Published by MAC on 2003-07-26

Cref Claims Ignorance of Gold Mining Controversies

Northwest Corporate Accountability Project Press Release

26 July 2003

The College Retirement Equities Fund (pension fund for college/university faculty and staff), which offers the largest singly managed stock account in the word, notified the Securities and Exchange Commission on July 24, 2003 of its intent to omit a shareholder proposal from its proxy material for the 2003 CREF Annual Meeting.

The proposal requesting a vote of CREF participants on divestment of gold mining investments was submitted by Ann E. Marchand, a CREF participant from Seattle, WA. In its letter to the SEC, CREF claims, "The Company is not aware of any debate, media attention, or legislative or regulatory initiatives regarding gold mining."

However, significant social policy concerns regarding gold mining are not new to CREF. In 1999, Ms. Marchand submitted a shareholder proposal to CREF specifically requesting that CREF divest itself of Freeport McMoRan Copper and Gold Stock because of its environmental and social impacts at its mining site in West Papua, Indonesia.

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This proposal received 17.3% of the vote at CREF's 1999 Annual Meeting, documenting a significant interest by CREF participants in this issue and far in excess of the vote needed to resubmit the proposal under Rule 14a-8(i)(12). Along with another CREF participant, the proposal was resubmitted to CREF in 2000. This time CREF launched an all out effort to defend Freeport and exclude the proposal. Because the proposal dealt with a single stock, the SEC concurred that the proposal could be omitted. CREF (pub. avail. Sept. 7, 2000).

The proposal submitted to CREF in 2003 included in the supporting statement information concerning Freeport's practices. In CREF's response to the SEC, it referenced Freeport's website as a source of rebuttal information, pointed to the lack of information concerning other companies, and claimed that CREF was unaware of any concerns or controversy regarding gold mining.

As a result, an amended resolution has been submitted to CREF with the same proposal, but documenting problems with other gold mining companies including Newmount Mining; Placer Dome; Rio Tino; and NewCrest Mining. The SEC is currently reviewing the amended resolution and will soon make a decision whether or not CREF must include the resolution in its proxy material.

What you can do:

Write to

William J. Kotapish, Esq. Assistant Director Division of Investment Management Securities and Exchange Commission 450 5th St., N.W. WA D.C. 20054

Strongly urge that the SEC require CREF to include in its 2003 proxy material the gold mining divestment proposal submitted by Ann Marchand. Include any references, websites, or other material concerning environmental and social impacts from gold mining.

Send a copy of your letter to:

Herbert Allison Chairman and CEO CREF 730 Third Ave New York, N.Y. 10017-3206

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