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Domini Social Investments Publishes Fifth Annual Proxy Voting Guidelines And Social Screening Criteria

Socially Responsible Fund Reissues Challenge to Mutual Fund Industry to Publish its Proxy Votes

New York, NY – Amy Domini, Founder and Managing Principal of Domini Social Investments, the manager of the Domini Social Equity Fund (DSEF) (ticker symbol: DSEFX), announced today the publication of Domini Social Investments’ fifth annual Proxy Voting Guidelines and Social Screening Criteria. Last year, the firm built upon its longstanding practice of publishing its voting guidelines by becoming the first mutual fund manager in the country to publish the actual votes it cast for each company in its portfolio. This year, Domini Social Investments entered its second year as a fully transparent voter, and reissued its challenge to the mutual fund industry to follow suit.

"Over the past five years, we’ve seen assets in mutual funds grow from $2.81 to $6.77 trillion. Mutual funds now hold nearly $4 trillion in equities and play a significant role in the governance of American corporations through the substantial voting power they wield. Unfortunately, many are unwilling to disclose these voting decisions to anyone – not even to their own fund shareholders. Last year, we became the first mutual fund manager in the country to publish its proxy voting decisions. We put them on our website for all to see. One year later, we are still waiting for the industry to take up our challenge and follow our lead," said Ms. Domini.

Speaking before the Investment Company Institute Procedure Conference in December 1999, SEC Commissioner Paul Carey noted "at least three" entities that have begun providing voting information on their websites: Calpers (the California Pension and Retirement Benefits System), TIAA-Cref, and the Domini Social Equity Fund. Commissioner Carey noted that "the Division of Investment Management is exploring possible recommendations concerning investment advisers' obligations to disclose how they vote proxies" and asked "that you consider whether disclosing fund voting practices or policies would be useful information for your shareholders." Following standard SEC procedure when making public statements, the Commissioner noted that he was expressing his own views, and not that of the Commission.

Visitors to Domini Social Investments' website, www.domini.com, can choose any of the 400 companies in the Domini Social Equity Fund's portfolio, see a brief description of the issue being voted on, and view Domini's vote. The website will be updated continuously, as proxy materials for each company become available. The firm intends to post its votes approximately two weeks prior to each company's annual meeting.

"Every year, shareholders of the world’s largest corporations are faced with numerous opportunities to register their voices for positive change. Last year, for example, we voted to support a resolution at Home Depot asking the firm to phase out its use of old growth wood. Several months later, the company publicly announced a plan to phase out sales of wood from endangered forests by 2002. Last year, we cast votes on 1,180 individual issues for the 400 companies in our portfolio. We voted to support 33 social-issue resolutions at 27 companies, including 8 resolutions we helped place on the ballot. By supporting these resolutions, we are not simply speaking out for social and environmental justice – we are helping to build better corporations by asking them to be more accountable to their stockholders, their employees, the communities in which they operate and to the natural environment. At the same time, we are making ourselves more accountable to our own shareholders," continued Ms. Domini. "We strongly encourage our colleagues in the mutual fund industry to follow our lead by making their proxy voting record public so that investors will be able to properly assess the full implications of their investment decisions."

Each year, Domini Social Investments publishes its proxy voting guidelines and social screening criteria. This year’s edition describes Domini’s voting policy on more than 80 types of resolutions ranging from environmental reporting to labor relations at home and abroad to executive compensation. The booklet also includes the firm’s social screening criteria, describing in detail how the Domini 400 Social Index was constructed and is maintained, and how the firm evaluates the social and environmental records of publicly traded corporations. The 40-page booklet also presents an historical overview of Domini Social Investments’ seven-year-old shareholder activism program, including a listing of every shareholder resolution the firm has ever filed – 46 in all. The booklet is distributed free of charge every year by Domini as a public service, and is posted on the firm’s website.

This year, Domini Social Investments filed ten resolutions on a range of issues, including board diversity, environmental reporting and sweatshops. For example, Domini is a lead filer of a resolution with Nordstrom, Inc. on contract-supplier standards, and co-filed a resolution with Home Depot, asking the company to disclose data on the diversity of its workforce. Domini Social Investments co-leads a group of concerned investors that has been meeting with Walt Disney Co. for the past three years to discuss the firm’s global labor standards. The group holds more than one million shares of Disney stock. Domini is also engaged in dialogue with The Gap on labor conditions at their worldwide facilities, and Coca-Cola on recycling.

Domini Social Investments' proxy votes can be viewed online at www.domini.com. Investors seeking additional information on the Fund, or a free copy of the firm's Proxy Voting Guidelines and Social Screening Criteria, may call (800) 762-6814, or visit www.domini.com.

Domini Social Investments manages more than $1.8 billion in assets for individual and institutional investors who are working to create positive change in society by using social and environmental criteria in their investment decisions. The firm's flagship product, the Domini Social Equity Fund, is a socially screened no-load index fund. The firm also offers an FDIC-insured community development money market account through its partnership with South Shore Bank.

The 40-page Guidelines were developed in cooperation with Kinder, Lydenberg, Domini & Co., Inc. (KLD) of Boston, Massachusetts, an affiliate of Domini Social Investments, with assistance from the Interfaith Center on Corporate Responsibility.