Subject: File #S7-25-97 Date: 11/26/97 10:57 PM CHAIRMAN ARTHUR LEAVITT Securities and Exchange Commission 405 5th Street NW Washington, D.C. 20549 Dear Chairman Leavitt, We are writing to express our serious objection to the SEC's proposed rules (S7-25-97). If adopted, these rules would dangerously undermine the shareholder process and give companies free license to make dangerous, shortsighted management decisions without review by, or accountability to, their investors. The shareholder process is a powerful tool of democracy, and has let to some important changes. Examples are: Clear standards for corporate environmental behavior Divestment in South Africa An end to the use of child labor in the U.S.A. The shareholder process allows for dialogue between shareholders and corporate decision-makers and helps find real solutions to urgent social, environmental, labor and human rights issues. The new rules would be extremely problematical in the following ways: They would block shareholder resolutions that address less than 3% or $10 million of a company's business. This provision would effectively eliminate many emerging issues or business practices that are not easily measured in dollars such as sweatshop labor or pollution. They would provide an automatic qualification for any resolution sponsored by the owners of 3% of a company's shares of stock. For most Fortune 500 companies, 3% of the shares means more than $1Billion worth of stock. This means only the biggest investors could wield this kind of clout. That would be utterly undemocratic We urge you most strongly to protect the rights of american shareholders to address irresponsible corporate behavior through the shareholder resolution process and stop these regulations from going through. Sincerely, Louise Aldrich and Helen Callbeck 57 Meadow Drive San Rafael, CA 94903