Subject: Opposition to File No.S7-25-97

Date:    11/20/97 12:02 PM
     
     
Dear Chairman Leavitt,
     
        I am writing to you to voice my opposition to SEC File No.S7-25-97.  
Historically, environmental groups, labor unions, churches, and socially 
responsible mutual funds have banded together as investors in order to 
challenge corporate irresponsibility.  Many big companies however, would 
rather not be bothered with the concerns they raise.  Most companies are 
required to hold annual meetings of shareholders.  The typical business 
of such meetings is to rubber-stamp management proposals, but 
increasingly they are also used by activist investors to try to shed 
light on corporate abuses.  Many companies will negotiate with 
environmental groups, churches and others to improve matters in an 
effort to keep these proposals off the ballot.  By making it harder to 
introduce social shareholder resolutions, the SEC will weaken the 
ability of activist investors to pressure companies to improve their 
practices.
     
    One of the great successes of such a shareholder movement was 
when it demanded that companies operating in South Africa under 
apartheid improve the situation there or pull out. If these rules had 
been in place then, shareholder campaigns calling for economic 
divestment from South Africa would never have been successful.  The 
following provisions are especially problematic:
     
        The new rules 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.
     
        The new rules 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 $1 billion worth 
of stock, which means only the biggest investors could wield this kind of 
clout. This is grossly discriminatory.
     
        I would greatly appreciate your consideration of such issues and 
would welcome any further comments on the issue.
     
     
                                        Sincerely,
                                        Niles Donegan
                                        412 Chapman Road
                                        Keene, NH 03431
                                        (603) 352-7897