Unitarians Join Shareholder Action Against DAPL Investor, Big Questions Looming

This is the third in a series of blogs exploring how religious communities are reviewing their investments for ties to the Dakota Access Pipeline. Part I reviewed ELCA investment policies. Part II reviewed the Presbyterian Church’s investment policies. Today, we look at the Unitarian Universalist Association.

The Unitarian Universalist Association (UUA) is one of several religious communities asking tough questions and putting pressure on companies involved with the Dakota Access Pipeline (DAPL).

The pressure comes in the form of shareholder actions. Religious communities tend to have large investments, both endowments and retirement funds, and hold stocks in a variety of companies. In the UUA’s case, it has an endowment of $170 million and a retirement plan with about $300 million. Its investments include Marathon Petroleum, a company which has contracted to use the pipeline. (Marathon also has a pending purchase offer to become a minority owner of the pipeline, according to an Inside Climate News Fact Sheet.)

The UUA has joined in a shareholder action to press Marathon for more information on the pipeline. This is not divestment, but it is needed pressure; it is a possible step toward divestment if investors find the answers unsatisfactory.

The issue is coming to a head. Under the Obama administration, the U.S. Army Corps of Engineers had denied the project a needed easement under the Missouri River; it was going to require more environment study. The Trump administration has given indications that it will proceed with DAPL (as well as restart discussions about the Keystone XL pipeline. See yesterday’s blog.)

A green light on the project will raise the stakes for those organizations that have pledged to support Standing Rock Nation and its opposition to DAPL — particularly those organizations with money invested in companies supporting the pipeline.

Quick background: On Aug. 30, UUA President Rev. Peter Morales issued a statement asking members to join him in opposing DAPL:

The construction of the massive Dakota Access pipeline, stretching from North Dakota to Illinois, is a textbook case of marginalizing minority communities in the drive to increase fossil fuel supplies. As people of faith and conscience, committed to protecting the interdependent web of all life and supporting indigenous rights, Unitarian Universalists cannot remain silent as land held sacred by our Native American siblings is threatened.

We join other faith groups and native tribes to support the Standing Rock Sioux Tribe as they oppose the construction of this dangerous pipeline. …

Tim Brennan, the UUA’s Treasurer and CFO, said in a phone interview that this is an unusual situation: “I have never seen anything like this before, this intersection of the investment world and indigenous rights.”

In an email exchange from early January, Brennan said the bulk of UUA’s investments use an ESG assessment. ESG is short-hand for Environmental, Social and corporate Governance. and refers to a particular approach to progressive investing. It assesses a company’s environmental impacts, its social concerns (such as human rights and consumer protection), and whether its corporate governance is transparent. “Overall, about 75% of our assets are managed with the application of ESG criteria,” he wrote.

Regarding DAPL in particular, Brennan wrote:

We have been working with the Interfaith Center on Corporate Responsibility and the Indigenous People’s Working Group on the DAPL issue. … The UUA’s specific role has been to be a co-filer of a resolution at Marathon Petroleum, which contracted to use the pipeline.

Brennan did not provide the text of the resolution, but likely it is similar to those offered by the ELCA (to Enbridge) and by the Presbyterian Church (to Phillips 66) which seem cut from a similar cloth. They put companies on notice that these issues are of great concern to investors, and ask the companies to detail their due diligence in assessing the social and environmental risks in the pipeline project, including indigenous rights risks.

The questions now are:

  • How long will it before shareholders get an answer — and what if anything could Marathon say about the pipeline that might change the UUA’s mind about the pr0ject and its impact on Standing Rock?
  • As the project now gains momentum, what if any next steps will emerge from the UUA or other faith communities that have committed to Stand with Standing Rock? Will they divest or take other substantive action?
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