Shareholders Press US Firms on N. Ireland
WITH South Africa's multiracial elections last week comes an end to corporate boycotts of the country.
The success of that anti-apartheid campaign, however, spawned several other efforts to change United States corporate policy abroad. One of its most successful prots - the MacBride Campaign - addresses religious discrimination in Northern Ireland.
The MacBride Campaign has since become both a thorn and a prod to the British government and US companies in Northern Ireland, urging them to boost hiring of Roman Catholics and to improve working conditions. The British government has fought the campaign, however, saying that its own recently strengthened laws in Ulster render MacBride irrelevant.
Jobless Catholic men
The British government and MacBride supporters agree that Catholics, particularly Catholic men, suffer employment discrimination in Northern Ireland. A 1991 census found that more than 28 percent of Catholic men were unemployed, compared with just under 13 percent of Protestant men.
In recent years, the employment of Catholics has risen slightly even as the overall unemployment rate increased. The proportion of Catholics employed in workplaces monitored by the government rose from 35 percent in 1990 to 36 percent in 1992.
US institutional investors supporting MacBride manage tens of billions of dollars in stock in companies with investments in Northern Ireland. Ford Motor Company, Timex, and Coca-Cola face boycotts led by the Irish National Caucus, one of MacBride's principal supporters.
Thus far, 15 American states and the District of Columbia, as well as 29 cities and counties across the country, have adopted laws based on MacBride, often restricting future pension fund investments in US companies that have not adopted MacBride.
``This is a very significant issue [for companies],'' says Ken Bertsch, senior analyst at Washington-based Investor Responsibility Research Center Inc. (IRRC). ``It doesn't get the press visibility of Sullivan [Principles against apartheid], and it is not as large a problem ... but it has been very successful in getting [laws] passed.''
IRRC monitors companies' compliance with shareholder agreements - including the MacBride Principles - for institutional investors such as pension funds. New York City comptroller's office, Washington-based Irish National Caucus, AFL-CIO, and New York-based Interfaith Office on Corporate Responsibility lead the loose coalition of organizations that comprise the MacBride Campaign.
Named after Sean MacBride, an ex-Irish Republican Army chief who later co-founded the human rights group Amnesty International, the MacBride Principles include:
* Banning provocative religious and political symbols, such as the British Union Jack flag, in the workplace.
* Asking companies to help ensure the safety of workers on the job and traveling to and from work - a particularly difficult problem in a country with clearly defined sectarian boundaries. If a company is located in a predominantly Catholic area and has mainly Catholic workers, Protestants may worry about working there.
* Asking companies to hire more of the underrepresented minority, particularly into management, where Catholics hold few positions.
``Some question whether this is the best way,'' says Suzanne Harvey, director of the Social Investor Research Service at Prudential Securities Inc. She says she considers the principles reasonable. ``We are still working on affirmative action in this country and we haven't found the answer,'' she says.
The IRRC credits the MacBride Campaign with pushing the British government to strengthen Northern Ireland's fair employment laws in 1989, which reduced religious tension in the workplace and raised awareness about fair employment practices.
The British government - which governs the 1.6 million people of Northern Ireland, 38 percent of whom are Catholic - views the campaign as unnecessary and ultimately counterproductive. It says the principles are empty slogans and the campaign deters much-needed foreign investment in the politically troubled region.
``We don't oppose the principles,'' says Sir Patrick Mayhew, secretary of state for Northern Ireland. ``[We oppose] the campaign. We think we do better.''
American companies in Ulster actually do better than average in hiring Catholics, says the IRRC's Mr. Bertsch. About 43 percent of workers at US companies are Catholics. But a number of US companies do have skewed work forces.
No company has agreed to abide completely by MacBride. But institutional shareholders backing the campaign have negotiated agreements with 28 of the 40 US companies with 10 or more employees in Northern Ireland, says Patrick Doherty, director of investment responsibility for the New York City comptroller's office and an architect of the campaign.
While too early to assess the impact of Britain's stronger anti-discrimination law, Northern Ireland's Fair Employment Commission has taken a number of companies ``severely to task'' and handed some companies heavy penalties, Bertsch says.
New laws on the books
The new law makes MacBride ``at best irrelevant and at worst harmful,'' says Terri Evans, public affairs officer at the British Consulate in Boston. ``The good it embodies is covered and then some by the [new laws]. On the harmful side ... the last thing companies need is another hoop to jump through.''
The British government says an American company, TRW Inc., sold its subsidiary in 1988 because of shareholder resolutions to adopt the MacBride Principles. But no jobs in Northern Ireland were lost. It says other companies decided not to move into Northern Ireland because of MacBride. The government declines to name them.
The IRRC's Bertsch says MacBride may intimidate some new companies considering investing in Northern Ireland.
Investment has increased in Northern Ireland over the last 10 years. According to British Prime Minister John Major, 74,000 additional jobs have been created in Northern Ireland over the last decade, a 13 percent increase. During the past six years, US companies have created nearly 5,000 jobs.
``Some companies see [MacBride] as a big issue, others roll with it,'' Bertsch says.