Fidelity Funds Vote Down Effort to Block Sudan Investments
The Associated Press said the proposal won 28% support at Fidelity’s nearly $2 billion Select Health Care Portfolio, and 27% at the $9 billion Capital and Income Fund. Fidelity urged shareholders to reject the measure, telling them it would conflict with the company’s responsibility to maximize shareholder returns.
The nonbinding measure asks fund boards to direct individual fund managers to screen out investments that the boards determine are tied to human-rights violations and genocide in places such as Darfur.
Eric Roiter, general counsel for Fidelity’s mutual funds, told the AP the ballot proposal would limit investments that comply with the law. Current federal law bars U.S. companies from doing business with firms owned or controlled by Sudan’s government, but does not prohibit mutual funds from investing in overseas firms that do business there.
The activists said they plan to continue pressing for votes this spring at other Fidelity funds, as well as those at rivals including Vanguard Group, American Funds Distributors Inc., Barclays PLC, and Franklin Templeton Investments.
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