Investors Press Immigration Reform

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With a number of states contemplating anti-immigration legislation and the federal government cracking down on undocumented workers, a coalition of institutional investors with more than $145 billion under management is enlisting Corporate America to help find better solutions.Recently, more than 60 institutional investors, including many leaders in the socially responsible investing space, penned a letter to the CEOs of 150 major companies in the U.S. asking them to speak out in support of comprehensive immigration reform policy. "The current policy is not working for anyone ... We feel we need to open the door to a sensible discussion in this country," Heidi Soumerai, director of ESG Research for Walden Asset Management and the main contact for the letter, tells FA Green. The coalition is hopeful that elected officials will put aside partisan politics long enough to support comprehensive immigration reform that's critical to advancing the U.S. economy and keeping the country globally competitive. It would also like to see reform include a pathway to legal status for undocumented immigrants. The investors initially selected 100 of the largest companies and then targeted additional ones in the agriculture, technology and leisure industries because of their heavy reliance on immigrant workers, says Soumerai. Roughly 8 million unauthorized immigrants made up 5.2% of the nation's total workforce in March 2010, estimates the Pew Hispanic Center, a project of the Pew Research Center. The percentage is much higher in construction (14%), agriculture (13%), and leisure and hospitality (10%), according to data cited in the letter.The U.S.'s ability to attract highly skilled workers also depends on comprehensive immigration policy, note the investors. They point to a Duke University study which identified at least one immigrant founder in one-quarter of all engineering and technology companies created in the U.S. in the decade ending in 2005.  "There really is a business case for sound immigration reform," says Susan Smith Makos, director of social responsibility for Mercy Investment Services. But it's more than just business, she and the other signatories agree. "This is the intersection of economics and human rights," says Soumerai. Comprehensive reform must value the integrity of families and prevent immigrant workers, temporary and permanent, from being subjected to second-class employment standards, the coalition told CEOs. Makos and Tim Brennan, treasurer and chief financial officer of the Unitarian Universalist Association, tell FA Green they're very concerned about the effect of current immigration policies on families. Deportation practices are inconsistent and insensitive, notes Makos.Standing on the Side of Love, a public advocacy campaign sponsored by the UUA, urges the end of programs that provide for local enforcement of federal immigration law as in Arizona. These programs "tear families apart and contribute to racial profiling, vigilantism, and fear of law enforcement that threatens the safety of all our communities," says the campaign. "The discussion has gotten so polarized. There's no discussion of how detrimental current policies are to workers and the economy," says Brennan. By asking companies to get involved, "We're really trying to take a positive approach."Brennan doesn't expect changes to come overnight. "Frankly, I think the next two years will be tough," he says, based on the positions various Congress members have taken. Still, "we need to introduce better information into the conversation now," he says.The coalition is encouraged by the Partnership for a New American Economy , a group of bipartisan mayors and business leaders founded last year to raise awareness of the economic benefits of sensible immigration reform. Co-chairs include the CEOs of Boeing, Marriot, Microsoft, News Corp. and the Walt Disney Co. So can companies that hire illegal immigrants still be considered socially responsible? Soumerai doesn't know anyone making a judgment. "The issue is complex. The big question is, 'Are (workers) being treated in a fair manner?'" she says.The UUA doesn't have an official position on whether or not it's OK to hire illegal immigrants, but such practices are "evidence for the need of the kinds of policies we're advocating," says Brennan. He'd like to see companies include immigration policies in their social responsibility reports. The coalition encourages companies to post support for immigration reform on their company Web sites and in other corporate publications.While immigration policy is not currently an investment screen for the UUA, which manages approximately $300 million for about 1,000 congregations, Brennan says it's a possibility down the road. One company which has earned praise for its sustainability practices, Chipotle Mexican Grill ( CMG ), has suddenly found itself as the poster child for immigration issues. The restaurant chain was recently forced to dismiss hundreds of illegal workers in Minnesota following a U.S. Immigration and Customs Enforcement audit, and ICE is now investigating its Virginia and Washington, D.C., locations. The company says it's been working to improve its policies and procedures for verifying documents.Although environmentally focused investment management firm Winslow Management Company sold off Chipotle, a long-term favorite, in late 2010 because it passed its price expectation, "I'm hoping they do the right thing," says Winslow founder and chief investment officer Jack Robinson.Employee relations are very important to him. "To me, it's fairly straightforward: we have laws in this country that we need to live by or see change. Any company that's breaking the law, no matter what the law is, is suspect. If a company breaks one law, is it breaking others?" he says.Looking ahead, Robinson expects more discussion and corporate transparency regarding hiring practices in general. "Sustainability is not just about profits or the environment. It also includes corporate social responsibility."

- Jerilyn Klein Bier


Financial Advisor magazine reaches 90,000 financial planners and investment advisors through its print publication and its Web site . It also publishes FA green , for advisors interested in socially responsible investing, and Private Wealth , for advisors targeting the ultra high-net-worth market.



The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of The NASDAQ OMX Group, Inc.

Copyright © 2010 Charter Financial Publishing Network Inc. All Rights Reserved.


This article appears in: Financial Advisor Center , Business

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