Remembering Rich Ferlauto

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Stephen M. Davis is associate director of the Harvard Law School Programs on Corporate Governance and Institutional Investors, and a senior fellow at the Program on Corporate Governance. This post is based on remarks Professor Davis recently delivered at a memorial service for Rich Ferlauto. Ferlauto died this spring at the age of 60.

The memorial service for Rich Ferlauto was held on June 25, 2017 at Temple Rodef Shalom in Falls Church, Virginia. Ferlauto died May 8. He was most recently a co-founder of the 50/50 Climate Project, and a former deputy director of policy in the SEC’s office of investor education and advocacy. He was also a founder and leader of the AFL-CIO and AFSCME’s capital stewardship program.

“Can we talk?” That was Rich’s signature email—many in the corporate governance community got those, as I did over 20 years, all the time. Well, Rich could talk. Indeed he could talk to corporates, investors, politicians. When Congressman Barney Frank needed to strategize, Rich would be there. When Pfizer’s Peggy Foran needed to find a labor voice to explore solutions, Rich was there. When he talked to media, he could be scorching: “outrageous” was his favorite word when interviewed on the latest scandal, as Tom Croft has written. If boards failed to fix a problem, or the SEC failed to act, Rich would thunder in newspapers, radio and television, warning that “the outcry would be profound.” Rich was cunning with words; for instance, I remember him crafting the brilliant phrase ‘say on pay’ to describe investor votes on CEO compensation. He pioneered the powerful word ‘stewardship’ two decades before the concept was embraced by US shareowners. John Kennedy once said of Winston Churchill, “he mobilized the English language and sent it into battle.” So it was with Rich.

But what was his battle? Nothing less than overhauling our economy to make it work for ordinary citizens. Whenever I spoke with him, I always knew that behind the brainstorming about this shareowner resolution, or that legislation, he almost uniquely had that long game in mind. Whether at the AFL, or AFSCME, or ISS, or the SEC, or, or the 50/50 Climate Project, Rich stood against the excesses of elites and for the dignity and rights of the citizen.

It is hard to overestimate the impact he made. Virtually every major reform in the corporate governance architecture of today’s US market has his fingerprints on it. Moreover, the climate change vote against management last month at ExxonMobil will one day be seen as an historic turning point. An astonishing 62.5% of investors voted to defy the board on the environment. That outcome would have been deeply inconceivable even one year ago. Rich’s relentless, and relentlessly hopeful, engagement with the world’s biggest funds is paying off at last. There is doubtless a long road ahead. But make no mistake: we are today witnessing the birth of the accountable capitalism Rich long envisioned. 2017 is finally Rich’s world, but it is unfolding without our friend, our happy warrior, our gentle teacher. Rich truly moved the world. And Rich made us all realize we could do it alongside him, with joy.

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  1. James McRitchie
    Posted Friday, June 30, 2017 at 1:14 am | Permalink

    A wonderful tribute to a great guy. Thank you Stephen for putting it so well.

  2. Andrew Shapiro
    Posted Sunday, July 2, 2017 at 1:05 pm | Permalink

    Rich was a kind thoughtful and really bright activist. Thank you Stephen for words right on point. Very sorry to hear his biggest battle has come to an end. Will miss him at our regular CII gatherings.