With the exception of one snowstorm, it’s been a pleasantly mild winter here in Boston. It didn’t take long, however, to realize that this east-coast-meets-west-coast winter is a reminder to redouble our efforts relating to climate change and other corporate accountability issues.

Walden was disappointed by the decision of our governor to back away from the Regional Greenhouse Gas Initiative (RGGI), a seven-state coalition to cap emissions from power plants. We wrote to Governor Romney asking him to reconsider, as did Bank of America and Staples. All of the letters emphasized that taking serious action now to decrease greenhouse gas emissions would strengthen the Massachusetts economy, its companies, cities, and citizens.

While Massachusetts remains guarded about taking action on greenhouse gases, we have seen forward movement from an unexpected actor. Exxon Mobil is slowly and subtly withdrawing its resistance to the theory of climate change. Walden co-filed a resolution at Exxon this year asking that the company make available the research data relevant to its stated position on the science of climate change. We have withdrawn that proposal given the extensive report recently published by the company and now available on its website. This is not a complete victory, however, as Exxon continues to hedge on accepting fully that human-made emissions are contributing to global climate change. We continue to push, encouraging the oil industry giant to plan for a carbon constrained future. We also continue similar conversations with Chubb and Apache.

Greenhouse gas emissions are, unfortunately, not the only worrying pollutant being released into our environment. As such, Walden submitted comments on the EPA’s proposed rule changes to the Toxics Release Inventory (TRI). The TRI tracks information on toxic chemical releases and other waste management activities by certain industries and federal facilities. EPA’s proposal recommends reducing TRI reporting frequency from annually to bi-annually and decreasing the thresholds that trigger detailed toxin and facility reporting. We wrote to the EPA that our investment analysis of environmental impact and performance makes regular use of TRI data, and that the positive benefits of the program, such as emissions release reductions, far outweigh any modest cost savings associated with the proposed changes. Walden encouraged other investors, citizens, and our portfolio companies to weigh in before the mid-January deadline of the comment period. Opposition to the proposed changes surged, with more than 50,000 public comments submitted by deadline.

As we support greater transparency in the United States, we remember that in other countries expressions of beliefs are being censored. With that in mind, Walden participated in a Joint Investor Statement on Freedom of Expression and the Internet, led by Boston Common Asset Management LLC and Domini Social Investments LLC. The Statement calls upon Internet-focused technology companies to reaffirm and uphold freedom of expression, a core principle in the United Nations Universal Declaration of Human Rights. This initiative responded to media reports suggesting that some U.S. companies have been complicit in, or complacent about, allegations of foreign governments using Internet technology to support censorship, surveillance, and retribution in violation of basic human rights.

We understand that conducting business internationally brings with it complex challenges. This is particularly true for companies that are sourcing internationally and working to address labor conditions in their supply chain. Building on several years of dialogue and shareholder resolutions, TJX continues to make steady strides to address concerns of Walden and other investors relating to its vendor compliance program. TJX expanded discussion of its program on its website and agreed to continue discussions with investors on best practices in public reporting. As a result, Walden decided not to file a resolution in 2006. This winter, Walden began similar discussions with Ross Stores, and Ross has agreed that its board of directors would review its Code of Ethics in early 2006, specifically considering how to augment global labor standards in a manner consistent with the company’s business model.

In contrast to the complexity of international sourcing is the simplicity of adding “sexual orientation” as a clause to a company’s non-discrimination policy. Walden has heard from an extraordinary number of companies this season that have either changed their equal employment non-discrimination policies, or have confirmed for us that they are inclusive. The list: Apogee Enterprises, Carver Bancorp, CenturyTel, Cincinnati Financial, Commerce Bancshares, Dentsply, Diebold, Emerson Electric, First MidWest, Myers Industries, Renaissance Learning, and Strayer Education.

Wells Fargo recently took an exceptionally positive public stand in defense of its inclusive non-discrimination policies. A vocal activist group had severed its relationship with the company for its financial support of an organization dedicated to ending discrimination based on sexual orientation. The controversy became fodder for the media and a platform for this vocal group to challenge corporate policies generally. Not swayed by public attention, a company spokesperson commented, “Wells Fargo firmly believes it is our responsibility to serve every segment of our community and we view our support for the gay, lesbian, bi-sexual and transgender community as part of our broader commitment to diversity.”

We are encouraged by the number of companies constructively and amiably engaging in dialogue with Walden and other investors. These interactions indicate that companies are increasingly aware of, and educated on, issues of social, environmental and political importance.

—M. Benton