SRI Trends, Part V: Growth of ETFs and Community Investing.

The below article is the last in our 5 part series on SRI Trends:
4.  Growth of Exchange Traded Funds (ETFs).  This is an area that may well need little, if any introduction.  Though a recent addition to investment portfolios during the last decade, ETFs have become an overnight sensation. 
Definition:  ETFs offer public investors an undivided interest in a pool of securities and other assets and thus are similar in many ways to traditional mutual funds, except that shares in an ETF can be bought and sold throughout the day like stocks on an exchange through a broker- dealer.  ETFs therefore possess characteristics of traditional mutual funds, which issue redeemable shares, and of closed-end investment companies, which generally issue shares that trade at negotiated market prices on a national securities exchange and are not redeemable (Source: Securities and Exchange Commission).
History: In the beginning, ETFs were more simplified investment vehicles utilized to mimic the S&P 500 index.  The first major product, SPDRs (introduced in 1993) was nicknamed “Spiders.”  As you can see, the ETF industry had creative marketing popularizing them since Day 1.  However, ETFs took off in the early 2000s, when Barclays Global Investors launched the ishares line.  Within 5 years, iShares surpassed all of its competitors.  Since then, new competitors have entered the market slicing and dicing industries and sectors into a thousand pieces.  According to the Investment Company Institute (ICI) the number of ETFs grew from just 29 in 1998 to 797 by 2009, representing $777Bn in assets.
It was only a matter of time that ETFs would move out of its humble beginnings as a broadly based index fund, to a mimicker of certain Socially Responsible Indices, such as those following the popular, and longest-running Domini Social Index (now called FTSE KLD 400).  According to Morningstar, there were over $3.2Bn in about two dozen SRI related ETFs as of mid-2010.
This website will not advocate investing in ETFs for a variety of reasons.  For starters, they attract a speculative nature (e.g., animal spirits) in people.  I just can’t reconcile the “making of a quick buck” with ethically-based SRI.  Other negatives include:  Tracking error, Index Composition, sometimes-high management expenses, opaque operating structure, and hidden fees.  Hmm, maybe the ETF holding company itself should be analyzed for ESG criteria!
SRI ETFs, given their niche nature only exacerbate these potential disadvantages.  For example, by default, an ETF tracking the S&P500 will likely have much lower fees and little tracking error, compared to a small, new, exotic ETF tracking solar energy.  Besides, nearly all of the SRI ETFs are invested in “Green-Energy” indices, rather than indices of socially responsible corporations (regardless of whether they’re in green industries or not).  Also, much has been written about surprise investments within ETFs including shares of Halliburton, and BP/Transocean.  As I’ve stated previously, but bears repeating, the individual investor’s desires and moral suasions become disconnected from the ETF’s investment process, and hence, positions.
If you must invest in pooled assets, I recommend screening MorningStar for SRI-based mutual funds.  Morningstar actually uses another name for SRI, calling it Socially Conscious funds.  It defines them as,
“Any fund that invests according to non-economic guidelines. Such funds may make investments based on such issues as environmental responsibility, human rights, or religious views. A socially conscious fund may take a pro-active stance by selectively investing in, for example, environmentally friendly companies, or firms with good employee relations. This group also includes funds that avoid investing in companies involved in promoting alcohol, tobacco, or gambling, or in the defense industry.”   

The most popular include some of the better-known fund families in this area:  Parnassus, Ariel, Pax World, Amana, Calvert, Domini and Sentinel.  Similar to ETFs, SRI mutual funds have grown at a rapid clip.  As of 2007, there were 260 socially screened mutual fund products in the US, with assets of $201.8 billion. By contrast, there were just 55 SRI funds in 1995 with $12 billion in assets (

5.  Community investing is directing capital from investors and lenders to communities that are underserved by traditional lenders.  According to the Social Investment Forum “Community investing provides access to credit, equity, and basic banking products that these communities would otherwise lack.”  Assets in community investing institutions rose about 32% from $19.6Bn in 2005 to $25.8Bn in 2007.  I am a great believer of this type of investing; however, it is out of the scope of this website, hence the quick description.  Interested readers are urged to link to

Equal Justice Works Summer Corps: Application Available January 2011

The Summer Corps application will be available in January 2011, but get your application materials ready now!

The Equal Justice Works Summer Corps program engages law students around the country who are expanding the delivery of legal services to those who need it most. Summer Corps members provide critically needed legal assistance in low-income and underserved communities in the United States on a broad range of issue areas.

Summer Corps is an AmeriCorps-funded program that in 2010 provided 577 law students with the opportunity to earn a $1,000 education award voucher for dedicating their summer to a qualifying legal project at a nonprofit public interest organization.

As part of your application, you will need a host organization (any 501(c)(3) nonprofit organizations or qualifying public defender programs) for your qualifying project. Summer Corps supports projects in which students provide primarily direct legal services to low-income and underserved individuals. Community outreach and education components are also encouraged.

Check back here for updates:

An Oasis of Philanthropy in November

This last day of November gives me the opportunity to reflect on the special month in many ways that November has been.  Amidst a month of giving thanks, overeating, and shopping, there is an oasis of philanthropy.

November has Thanksgiving Day, designated shopping days like Black Friday, Cyber Monday, and the newly created Small Business Saturday, ( mentioned here earlier). And right smack in middle of this celebrated month exists another type of designated "day" meant to encourage and honor philanthropy, the act of caring and giving to others. National Philanthropy Day  founded by the Association of Fundraising Professionals has designated Nov 15th  for events all around the country. Last year more than 100 AFP chapters held NPD award ceremonie snot only on this day but throughout the entire month, on whichever day worked best for honoring the individuals,organizations and small businesses in their communities that "change the world with giving heart".

The official website of National Philanthropy Day lists the dates of the chapter events all throughout the country and the recipients of the awards. In northern California these following small businesses have been honored.

The Central Coast:
Earthbound Farm, the largest grower of organic produce in the United States,was named philanthropic organization of the year for the Central Coast as part of National Philanthropy Day for their support to a wide array of charities and more than 350 nonprofits. Many of these charities are nominated through their employee giving program. You can read their full story in the San Jose Mercury News

San Francisco:
Borel Private Bank & Trust Company for 30 years has been providing private banking, investment, and trust services on the San Francisco Peninsula. Borel has received this award in recognition of their support of over 243 community non-profit organizations with contributions and employee volunteerism.

Silicon Valley
The Wish Book of the Mercury News features stories of needy individuals families and organization with links for readers where they can earmark their donations. Since 1983, readers have donated more than $6.5 million for individualized needs such as wheelchairs, food or computer equipment for recipients.

Sleep Train‘s company philosophy has included a commitment to giving back to the community for over 20 years. Their philosophy about community involvement is that "their success is not measured by the bottom line alone". Sleep Train's main cause has been to help make a difference in the lives of foster children. Sleep Train, was  featured on our blog in 2009.

I hope National Philanthropy Day will continue to expand all over the country and be held almost every day in November somewhere-so the whole month of November can be thought of as a month of changing the world with a heart.

US diplomats spied on UN leadership home

• Diplomats ordered to gather intelligence on Ban Ki-moon
• Secret directives sent to more than 30 US embassies
• Call for DNA data, computer passwords and terrorist links

UN secretary general Ban Ki-moon
A directive from Hillary Clinton ordered US diplomats to gather biometric information on the UN secretary general, Ban Ki-moon. Photograph: Bernat Armangue/AP

Washington is running a secret intelligence campaign targeted at the leadership of the United Nations, including the secretary general, Ban Ki-moon and the permanent security council representatives from China, Russia, France and the UK.

A classified directive which appears to blur the line between diplomacy and spying was issued to US diplomats under Hillary Clinton's name in July 2009, demanding forensic technical details about the communications systems used by top UN officials, including passwords and personal encryption keys used in private and commercial networks for official communications.

It called for detailed biometric information "on key UN officials, to include undersecretaries, heads of specialised agencies and their chief advisers, top SYG [secretary general] aides, heads of peace operations and political field missions, including force commanders" as well as intelligence on Ban's "management and decision-making style and his influence on the secretariat". A parallel intelligence directive sent to diplomats in the Democratic Republic of the Congo, Uganda, Rwandaand Burundi said biometric data included DNA, fingerprints and iris scans.

Washington also wanted credit card numbers, email addresses, phone, fax and pager numbers and even frequent-flyer account numbers for UN figures and "biographic and biometric information on UN Security Council permanent representatives".

The secret "national human intelligence collection directive" was sent to US missions at the UN in New York, Vienna and Rome; 33 embassies and consulates, including those in London, Paris and Moscow.

The operation targeted at the UN appears to have involved all of Washington's main intelligence agencies. The CIA's clandestine service, the US Secret Service and the FBI were included in the "reporting and collection needs" cable alongside the state department under the heading "collection requirements and tasking".

The leak of the directive is likely to spark questions about the legality of the operation and about whether state department diplomats are expected to spy. The level of technical and personal detail demanded about the UN top team's communication systems could be seen as laying the groundwork for surveillance or hacking operations. It requested "current technical specifications, physical layout and planned upgrades to telecommunications infrastructure and information systems, networks and technologies used by top officials and their support staff", as well as details on private networks used for official communication, "to include upgrades, security measures, passwords, personal encryption keys and virtual private network versions used".

The UN has previously asserted that bugging the secretary general is illegal, citing the 1946 UN convention on privileges and immunities which states: "The premises of the United Nations shall be inviolable. The property and assets of the United Nations, wherever located and by whomsoever held, shall be immune from search, requisition, confiscation, expropriation and any other form of interference, whether by executive, administrative, judicial or legislative action".

The 1961 Vienna convention on diplomatic relations, which covers the UN, also states that "the official correspondence of the mission shall be inviolable".

The emergence of the directive also risks undermining political trust between the UN leadership and the US, which is the former's biggest paying member, supplying almost a quarter of its budget – more than $3bn (£1.9bn) this year.

Washington wanted intelligence on the contentious issue of the "relationship or funding between UN personnel and/or missions and terrorist organisations" and links between the UN Relief and Works Agency in the Middle East, and Hamas and Hezbollah. It also wanted to know about plans by UN special rapporteurs to press for potentially embarrassing investigations into the US treatment of detainees in Iraq, Afghanistan and Guantánamo Bay, and "details of friction" between the agencies co-ordinating UN humanitarian operations, evidence of corruption inside UNAids, the joint UN programme on HIV, and in international health organisations, including the World Health Organisation (WHO). It even called for "biographic and biometric" information on Dr Margaret Chan, the director general of WHO, as well as details of her personality, role, effectiveness, management style and influence.

The UN is not the only target. The cables reveal that since 2008 the state department has issued at least nine directives to embassies around the world which set forth "a list of priorities intended to guide participating US government agencies as they allocate resources and update plans to collect information".

They are packed with detailed orders and while embassy staff are particularly encouraged to assist in compiling biographic information, the directive on the mineral and oil-rich Great Lakes region of Africa alsorequested detailed military intelligence, including weapons markings and plans of army bases. A directive on "Palestinian issues" sent to Cairo, Tel Aviv, Jerusalem, Amman, Damascus and Riyadh demanded the exact travel plans and vehicles used by leading members of Hamas and the Palestinian Authority, without explaining why.

In one directive that would test the initiative, never mind moral and legal scruples, of any diplomat, Washington ordered staff in the DRC, Uganda, Rwanda and Burundi to obtain biometric information of leading figures in business, politics, intelligence, military, religion and in key ethnic groups.

Fingerprints and photographs are collected as part of embassies' consular and visa operations, but it is harder to see how diplomats could justify obtaining DNA samples and iris scans. Again in central Africa, embassy officials were ordered to gather details about countries' military relations with China, Libya, North Korea, Iran and Russia. Washington assigned high priority to intelligence on the "transfer of strategic materials such as uranium", and "details of arms acquisitions and arms sales by government or insurgents, including negotiations, contracts, deliveries, terms of sale, quantity and quality of equipment, and price and payment terms".

The directives, signed simply "Clinton" or "Rice", referring to the current and former secretaries of state, Hillary Clinton and Condoleezza Rice, form a central plank of America's intelligence effort and reveal how Washington is using its 11,500-strong foreign service to glean highly sensitive information on both allies and enemies.

They are compliant with the National Intelligence Priorities Framework, which is approved by the president, and issued by James Clapper, the director of national intelligence who oversees the CIA, the Defence Intelligence Agency, FBI and 13 other intelligence agencies.

Washington circulated to its Middle Eastern embassies a request for what was effectively a counter-intelligence operation against Mukhabarat, the Palestinian Authority's secret service, and Istikhbarat, its military intelligence.

The directive asked for an assessment of the foreign agencies' "signals intercept capabilities and targets, decryption capabilities, intercept sites and collection hardware, and intercept operation successes" and information of their "efforts to illicitly collect classified, sensitive, commercial proprietary or protected technology information from US companies or government agencies".

Missions in Israel, Jordan, Syria, Saudi Arabia and Egypt were asked to gather biometric information "on key Palestinian Authority and Hamas leaders and representatives, to include the young guard inside Gaza, the West Bank", as well as evidence of collusion between the PA security forces and terror groups.

Taken together, the directives provide a vivid snapshot of America's perception of foreign threats which are often dazzlingly interconnected. Paraguayan drug traffickers were suspected of supporting Hezbollah and al-Qaida, while Latin American cocaine barons were linked to criminal networks in the desert states of west Africa, who were in turn linked to Islamist terrorists in the Middle East and Asia.

High on the list of requests in an April 2009 directive covering the Saharan west African countries, including Burkina Faso, Chad, Mali,Mauritania, Niger and Senegal, was information about the activities of fighters returning from Iraq and Afghanistan. Information was wanted on "indications that international terrorist groups are seeking to take advantage of political, ethnic, tribal or religious conflict".

Diplomats were told to find out about the links between drug traffickers in the region to Latin American cocaine cartels, as well as terrorist or insurgent groups' income derived from the drugs trade.

Sometimes the directives appear linked to forthcoming diplomatic obligations of the secretary of state. In a cable to the embassy in Sofia last June, five months before Clinton hosted Bulgaria's foreign minister in Washington, the first request was about government corruption and the links between organised crime groups and "government and foreign entities, drug and human trafficking, credit card fraud, and computer-related crimes, including child pornography".

Washington also wanted to know about "corruption among senior officials, including off-budget financial flows in support of senior leaders … details about defence industry, including plans and efforts to co-operate with foreign nations and actors. Weapon system development programmes, firms and facilities. Types, production rates, and factory markings of major weapon systems".

Top tips for dealing with defectors and turncoats

One cable offered a detailed and practical guide for embassies on how to handle possible defectors, known as "walk-ins", who turned up at embassies offering to switch sides. It called for them to be treated with considerable care because they "may be sources of invaluable intelligence".

"Walk-ins may exhibit nervous or anxious behaviour, particularly because access controls and host nation security forces around many of our diplomatic posts make it difficult for walk-ins to approach our facilities discreetly," it warned. "All briefings should also stress the importance of not drawing attention to the walk-in or alerting host nation security personnel."

Embassy staff should immediately copy the person's identification papers or passport, in case they got cold feet and ran off, it said. A walk-in who possessed any object that appeared potentially dangerous should be denied access even if the item was presented "as evidence of some intelligence he offers, eg, red mercury [a possibly bogus chemical which has been claimed to be a component of nuclear weapons] presented as proof of plutonium enrichment". 

WikiLeaks: Clinton ordered probe on UN chief

Israel News

Secret files show Washington wanted to find links between UN members, terror groups

Ronen Medzini

Published: 11.28.10, 23:46 / Israel News

Photo: AFPWikiLeaks revealed Sunday that US Secretary of State Hillary Clinton ordered a probe on UN Secretary-General Ban Ki-moon, as well as an investigation on possible ties between UN members and terror groups such as Hamas and Hezbollah.

"Washington wanted intelligence on the contentious issue of the 'relationship or funding between UN personnel and/or missions and terrorist organizations' and links between the UN Relief and Works Agency in the Middle East, and Hamas and Hezbollah," the British Guardian reported, citing the documents leaked by the controversial Web entity.

Washington also sent out orders signed by Clinton or Rice (aka Condoleezza Rice, Clinton's predecessor) ordering diplomats to gather "biographic and biometric" on various UN officials, including Ban, the report says.

It adds that the US may have "blurred the line between diplomacy and spying", and that the country's relations with the UN may now suffer due to the publication of the secret orders.

The US is one of the UN's biggest funders, donating over $3 billion annually to its function.

Israel was also included in the orders to collect intelligence on Mukhabarat, the Palestinian Authority's secret service, and Istikhbarat, its military intelligence; orders which Washington circulated among all of its embassies in the Middle East.

Diplomats in Israel, Jordan, Syria, Egypt, and Saudi Arabia were asked to gather biometric intelligence on Palestinian Authority officials and senior Hamas agents in Gaza and the West Bank, the report says, in an effort to ascertain links between the officials and terrorists.

GIZMODO: Wikileaks' Newest Leak Leaked on Twitter

Twitter has out-leaked the leakers. About 12 hours before Wikileaks latest enormous leak was scheduled to be released, a Twitter user bought a copy of a German news magazine outlining the leak after it was placed on newstands too early.

According to tweets from German-speaking Twitter users who snagged an embargoed copy of this week's Der Spiegel (cover above), the cache of over 250,000 confidentialdiplomatic cables may be a bit of a let-down. At least from the German point of view there are no earth-shattering revelations, just a lot of candid talk about world leaders. Angela Merkel is praised as "teflon," though she "avoids risk and is rarely creative," and German foreign minister Guido Westerwelle is repeatedly bashed. There is talk of Italian Prime Minister Silvio Berlusconi's "wild parties," (duh) and Iranian president Mahmoud Ahmadinejad is likened to Hitler. French President Nicolas Sarkozy is calledan "emperor with no clothes." The cables also show Obama has "no emotional relationship with Europe," focusing instead on Asian countries, according to Der Spiegel.

The full tranche of cables is apparently scheduled to be released by Wikileaks this afternoon at around 4:30 pm EST in concert with The New York Times, the Guardianand Der Spiegel. But this morning, a sharp-eyed Twitter user spotted a copy of Der Spiegel at a a rest area on the Germany-Switzerland border. "Der Spiegel too early in the Badische Bahnhof Basel!" wrote Freelancer_09. "We'll see what it says...... :)" He and another user, sa7yr, have been tweeting excerpts for a few hours now.

It's the biggest leak since Kanye West's new album! But Wikileaks has bigger problems: They just tweeted "We are currently under a mass distributed denial of service attack." The attack has apparently brought down.

Update: The New York Times has just launched their package on the cables.

How American Express Small Busines Saturday Could Work To Fight Hunger

While retail businesses are waiting anxiously to see whether consumers are feeling less pinched on this big holiday shopping weekend, the lines at the local food banks have doubled.

Small, local businesses have been hurt with the downturn of the economy contributing to the loss of jobs and reduced revenue to local communities. And yet, small businesses, many of them featured here, throughout this downturn have been finding creative ways to help support their local communities in spite of their own hard times.

Several posts here,earlier addressed the need for small businesses to understand that one of the most powerful ways for small businesses to grow is by giving back to their local communities. As I pointed out earlier small business can identify local community needs often better than larger companies and can offer unique opportunities for sponsorships and partnerships to local charities.

Now, small businesses may be getting a chance to get in on the weekend shopping madness with the declaration of Small Business Saturday.

This Saturday, November 27th comes a national movement, via American Express, to drive shoppers to support small businesses called Small Business Saturday(SM). This day was created to support the small businesses that create jobs, boost the economy and preserve neighborhoods around the country.

Here is how the program works:
* American Express is giving a $25 statement credit(1) to 100,000 Cardmembers who register their Card and use it to shop on Small Business Saturday at any locally-owned, independent small businesses that accept American Express.
* American Express is also giving $100 of free Facebook advertising(2) to 10,000 business owners who sign up at to help build online buzz and drive customers to shop at their businesses on Small Business Saturday. By simply entering a few pieces of information and clicking a button, these business owners can create a personalized, geo-targeted ad that will run on Facebook leading up to November 27th. Facebook has donated $500,000 in Facebook credits for these small business owners to use in the future.
 * Small business owners can also download online promotional materials and use a number of social media tools to promote their businesses on the inaugural Small Business Saturday.
* Everyone can spread the word about the day and their favorite businesses by giving a shout-out to their favorite local shops and restaurants via Facebook and Twitter.
* For every person who ‘likes’ Small Business Saturday on Facebook, American Express is donating $1 up to $500,000 to Girls Inc. to empower young women to be the entrepreneurs of tomorrow.

There are great reasons to support local businesses and here are the four reasons their site gives.
For every $100.00, $68.00 returns to the community.
Small Businesses employ over half of all private sector employees.
Small businesses represent over 99% of all employer firms.
In the last decade, 60-80% of new jobs were generated by small businesses.
And I'd like to add one more:
As small businesses grow they can give more back to their community.

So, I'd like to see a scenario where Small Business Day Can help boost a local business and help a cause, such as hunger:

In my area, in Palo Alto, CA a local men's clothing store, Patrick James is hosting an annual food drive until Nov.30th. Customers who bring canned items to any Patrick James store receive 15% off of that days purchase.

Now couple that with small business day, where a customer of a Patrick James store, could bring in canned goods for the, receive a 15% discount for their purchase and the $25.00 credit from American Express.

Let there be no doubt about the fact that the American Express Small Business Day is a strategy to boost the use of American Express credit card during the holiday season while aiming to boost sales for local small businesses. This is not meant as a criticism as this move is purely strategic and may prove to be a boon for the local small businesses.

Should they continue this idea, I would love to see some kind of partnering with local causes which would create a real boon to communities all over this country, and help to eradicate hunger, as well as other important causes.

UN Security Team in DPRK decides NOT to raise Security Status after bombings in the South

In a meeting held today by heads of UN Agencies in Pyongyang (who are also members of the UN Security team in DPR Korea) they decided:

1. Not to raise security phase alert for North Korea;
  • Members of security team expressed concerns that if they elevate current security phase in North Korea (DPRK) it might anger the DPRK Government and result in deterioration of the UN cooperation and programmes in North Korea;
  • They also feared that an increased security phase might mean a halt of programme work in the field, meaning international advisors, consultants and humanitarian aid personnel who work in capacity building programmes might not be allowed in the country;
2. Continue monitor the situation and decide accordingly;
  • Security team requested that the Security Focal Point keep ongoing contact with Un HQs (DSS) as well as the Western Embassies present in Pyongyang and brief accordingly the UN Team at any time;

Secret:While South Koreans are killed from Kim Jong-il artillery - Ban Ki Moon and South Korean Mission to the UN rush in to open credit line for Kim

in a secret document published this morning from FoxNews, is revealed that while North Korea was shelling the South Korean's island, killing civilians, Ban Ki-moon and his immediate staffers (Bob Orr and Kim won-so) are thinking to once again buy peace from the North by increasing the CASH for Kim Jong-il regime thru Helen Clark's UNDP. Another failed sun-shine policy.

UNDP Watch believes that this secret document, which seem to have been drafted under the direct supervision of the American Chair of the EOSG's Policy Committee, Mr. Robert Orr, could not have been commissioned unless with the direct blessing of US Mission to the UN (USUN) and/or involvement of China and/or Russia.

The document in itself seem to leave aside the national interests of South Korea and Japan. But it might as well be that the South Korean Mission to the UN, is trying to persuade Kim Jong-il to stop attacking by giving CASH thru United Nations, while "talking tough" on TV in front of an angry South Korean public who wants revenge. You never know with these diplomats.

Mingled Motives: Is Business Philanthropy Little More Than Good PR?

With the holiday season whipping into full swing and charitable giving on the minds of many, Pulitzer Prize-winning Los Angeles Times business columnist Michael Hiltzik asks some thought-provoking questions in today's column. Best of all, Hiltzik took a moment to interview our own Lalia Helmer and contribute her comments. What a cool shout-out!

Hiltzik asks, very rightfully, whether large-scale corporate philanthropy and "caused-based marketing" efforts amount to much more than a clever profit-booster, referencing among others the Product Red campaign, American Express' efforts, as well as a controversial program launched by Skechers USA this past summer, one that's widely believed to have copied the beloved TOMS Shoes model.

If you'll recall, Lalia cited the Skechers effort as an example of "how not to do business philanthropy." Hiltzik, in turn, fleshes out further thoughts on the topic.

The larger question, though, and one that transcends the TOMS/Skechers debate, remains: are the motives of heavily advertised philanthropic efforts somehow polluted when they simultaneously boost the bottom line of a business? It's a fascinating discussion, and a complex one, I think.

Here's Hiltzik's conclusion:

I'm always a bit suspicious when big corporations try to enlist me in their charity campaigns. My feeling is that if they're inclined to be generous, good for them, but leave me to my own philanthropies. That way, there's no confusion about when they're being genuinely good-hearted, and when they're just faking.

I certainly see his perspective. Then again, it's inherent to the nature of capitalism for businesses to enhance their bottom line by giving the consumer what they want, be it products or corporate practices. In our fast-evolving twenty-first century climate, there can be little question that consumers desire a more socially-conscious form of business. In that sense, many companies with an evolved sense of larger obligation thrive because they are responsive to the public. So why not advertise that fact just as they would, say, a superior product? Though certain efforts and organizations may be dubious, on the whole business philanthropy, at its most effective, can be a win-win.

The U.N.'s war against leaks

click here for this story on Foreign Policy

Posted By Colum Lynch Share

Stephen Mathias, one of the U.N.'s top lawyers, recently warned a reporter for the Canadian Broadcasting Corp., Neil Macdonald, that he planned to alert Canadian authorities that the reporter may have obtained leaked U.N. documents in violation of international agreements, prompting a sharp response from the Committee to Protect Journalists.

Joel Simon, executive director of the Committee to Protect Journalists, told Turtle Bay that a letter Mathias sent to Macdonald containing the warning was "menacing and inappropriate." He urged the U.N. to desist from pursuing an international investigation into CBC's reporting. "This letter could be construed as an indication that the U.N. could pursue legal action and we would take an extremely dim view of that," Simon said. "If the U.N. has an issue with the leak they need to pursue that within the United Nations and not target journalists who have an obligation to use this kind of information to inform the public."

Macdonald had obtained copies of highly sensitive internal memos from a U.N. commission that purportedly linked Hezbollah militants to the 2005 assassination of former Lebanese Prime MinisterRafiq Hariri, and that referred to U.N. suspicions that a top Lebanese intelligence official may have been involved in the plot. The documents -- which surfaced as part of a lengthy CBC investigation into Hariri's killing -- came from the U.N. International Independent Investigation Commission (UNIIIC), which carried out a five year long inquiry into the Valentine's Day murder of Hariri and 22 others.

The U.N. has "been informed that you have possession of certain UNIIIC documents," Mathias wrote to Macdonald. "I am writing to alert you to the fact that UNIIIC documents are United Nations documents enjoying inviolability under Article II of the Convention on the Privileges and Immunities of the United Nations. Inviolability entails that United Nations document cannot be disclosed to a third party, copied or used without the consent of the United Nations."

Mathias also asked Macdonald to contact the U.N. about the documents "so that we can assess whether the United Nations can agree to their voluntary disclosure. We are also alerting the Canadian authorities to this matter."

The letter represented an extraordinary effort by the United Nations to seek the cooperation from a member state to pursue a leak of U.N. documents. In June, 2002, the U.N. Tribunal for the Former Yugoslavia sought to compel a Washington Post journalist, Jonathan Randall, to testify before the court about an interview he had conducted with a Bosnian Serb official. An appeals court ruled that a reporter could only be compelled to testify to a U.N. if "the evidence sought is of direct and important value in determining a core issue in the case ... and cannot reasonably be obtained elsewhere."

The U.N. Secretary General Ban Ki-moon has been highly sensitive to leaks. Inga-Britt Ahlenius, the U.N.'s former head of internal oversight, wrote in a highly critical end-of-mission report in July that Ban's office was "consumed by leaks," and that she had refused requests to conduct internal investigations into such disclosures.

"I made the reason for this very clear: such investigations are non-starters," she wrote. "We do not have subpoena power and should not have. Journalists will not disclose the source of a leak....In my opinion, it would also be seen as very negative on the secretary general, who had advocated transparency, to pursue leaks....Such secretiveness serves us poorly, it only serves to feed rumors, gossip and finally distrust within the organization and between the organization and its external stakeholders, including the media."

U.N. officials at the time countered that it is improper for employees of the organization, just like government officials, to divulge confidential information to the press, saying it is within the U.N.'s right to take steps to prevent such breaches. Some U.N. officials have called Ahlenius' views towards disclosure naive, noting that the disclosure of privileged information can upend delicate diplomatic work, or in some cases endanger lives. The authors of one of the UN investigators memos leaked to the CBC expressed concern that the safety of a key suspect might be endangered if Hariri's assassins discovered he had come under scrutiny.

Mathias' letter was sent before the CBC published some documents in full on its website on Sunday night, raising concerns that the U.N. may have been seeking to intimidate the reporter into withholding some of the most sensitive information in the documents.

It might also reflect suspicions by U.N. lawyers that an individual Canadian official may be responsible for passing the documents to Macdonald. Spokespersons for the U.N. and for the U.N. Special Tribunal for Lebanon, which has taken over the responsibilities of the commission, declined to comment on the substance of the investigation. "I...don't have any comment on the substance of those documents," said Farhan Haq, spokesman for the U.N.

"I found it puzzling," Macdonald told Turtle Bay. "We have no idea whether the U.N. actually ‘alerted Canadian authorities,' as its lawyer threatened. But the issue is moot. I told the U.N. Tribunal's public relations person yesterday that if the UN wanted to examine the documents we have, it is welcome to do so. They are posted in PDF form on our website."

Follow me on Twitter @columlynch