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Thank you so much for your timely article on the business case for social responsibility ("Virtue Rewarded," October). It is gratifying to know that company executives, especially chief financial officers, are increasingly aware of just how important social responsibility is.
As part of the larger socially responsible investing movement — now representing more than $3 trillion in assets — the General Board of Pension and Health Benefits of The United Methodist Church has long been advocating for greater social and environmental accountability among many of the country's major companies. We do so because we believe that corporations focusing on short-term profitability, to the detriment of long-term sustainable business practices, are not good investment choices. It is our experience, and belief, that strong financial returns go hand-in-hand with strong social returns. For us, sensitivity to a company's social responsibility is an essential element of our fiduciary duty to our plan participants.
The General Board of Pension and Health Benefits, the largest denominational pension fund, with approximately $15 billion in assets, uses traditional shareholder advocacy tools to encourage companies to be more socially accountable. Just this year, we have urged as many as 20 companies to adopt better corporate-governance practices, to maintain high vendor standards, to label genetically modified foods, to report on issues relating to global warming, to guard against predatory lending, and to embrace sustainability. These issues, reflecting our specific religious tradition, with its emphasis on stewardship and justice, are at the very heart of how companies operate and perform.
As more executives come to understand that financial returns and social returns are not mutually exclusive, stakeholders everywhere will benefit. Thanks for telling this important story.
David H. Zellner
Chief Investment Officer
General Board of Pension and Health Benefits
The United Methodist Church
Evanston, Illinois
I thoroughly enjoyed your article on corporate responsibility. We call ourselves a "triple bottom line" company and have strict measurements around what we do. We thought we were alone!
Dan Hollowed
CFO
ShoreBank
Via E-mail
Go Ahead, Buy that Dream House
Great article on the value of self-directed individual retirement accounts ("A Chance to Direct," October). However, there were a couple of misconceptions I'd like to bring to your attention.
An IRA owner may invest in a sibling's business, since siblings are not disqualified persons according to the Internal Revenue Service. Of course, all those transactions should be market rate and aboveboard.
You may also buy the beach house you are in love with, as long as you don't use it while it is held by your IRA. You may rent it. When you are eligible for distributions, you may petition the IRS for a waiver to allow you to purchase the property from your plan (not usually allowed, but it may be granted if you can show that the IRA would benefit the same as if it were sold to a non-disqualified third party), you may take it in partial distributions over several years, or you may take the entire property at once as a distribution.
Transactions are not as complicated as they seem if you deal with an administrator that guides you through the process.
Jaime J. Raskulinecz
CEO
Entrust Northeast LLC
Verona, New Jersey
Thanks for the Road Map
We have been on an adventure in unassigned seating over the past 18 months, and I really wish that your valuable real-estate report had been available at the outset of our journey ("Take My Desk — Please," October). I can assure you that your article mirrors well the experiences that we have had. I also appreciate the insights from companies that are further down this road.
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