October 15, 2002
Jonathan G. Katz, Secretary
I am writing on behalf of MMA and the MMA Praxis Mutual Funds, a faith-based provider of stewardship solutions for Christians within the United States and manager of $1.2 billion in US and international investments. We wish to voice our support of the SEC's recently initiated rule requiring mutual funds and other investment managers to disclose their proxy voting records and guidelines.
While some in the mutual fund industry feel shareholders don't need to know or aren't interested in how proxies are voted, at MMA we believe in the importance of transparency-both in corporate practices and in the practices of the financial firms that invest in them. Over the past few months we have seen rising public concern regarding relationships between investment analysts and firms and many of the scandal-plagued companies currently dominating headlines. Given the power of mutual funds-holding more than $3 trillion in stocks and often the largest stakeholders in public companies-and as proxy voting is a critical component of the investor-company relationship, disclosing the nature of these votes and the policies under which these votes are framed seems to be a prudent and appropriate step of fiduciary responsibility.
In fact, MMA is and has been willing to stand behind its commitment to transparency. MMA Praxis Mutual Funds have been disclosing their voting record through our website (www.mmapraxis.com) for nearly three years. And we will soon be posting our proxy voting guidelines for public review following a revision process currently underway. MMA's own steps to further disclosure will proceed without further encouragement from the SEC. We see this as a part of our support of MMA's Stewardship Investing Guidelines one of which focuses responsible management and calls for companies to "obey or exceed all relevant laws for. . . public disclosure."
MMA and the MMA Praxis Mutual Funds believe the SEC's new rule is important for investors, for public faith in the financial services industry, and for the establishment of integrity-based relationships between investment managers and the companies they invest in.