"The activist nun reforming profit-prisons"

The title of this post is the headline of this intriguing new article via CNNMoney.  Here are excerpts:

Some of America's most controversial companies -- for profit prisons -- have unlikely owners: nuns. Mercy Investment Services Inc. is the investment fund for the Institute of Sisters of Mercy of the Americas, an international religious order.

The fund is managed by Sister Valerie Heinonen, a soft-spoken nun who's been buying shares in for-profit prison companies since early 2000.  She's not doing it in the hopes of making big bucks.  Rather, she tries to use her leverage as an owner to reform the industry.

"What we want is the establishment of a human rights policy at these companies," Heinonen told CNNMoney.  Even more importantly, she wants the policy to be thoughtfully implemented, monitored and transparently disclosed to shareholders....

For decades, investors have put billions of dollars into the two largest such companies, Geo Group (GEO) and Corrections Corporation of America (CXW).  Many investors saw dollar signs as prison populations swelled.  The stock of Geo Group has risen 130% in the past three years.

While profits have been huge, some money managers feel it is unfair for Wall Street to profit from what they see as the inhumane warehousing of human beings.  This issue is back in the forefront given the surge of immigrant detainees following the mass deportation effort of the Obama administration....

GEO Group and CCA say they are committed to protecting the human rights of prisoners and detainees.  "Our company adopted a Global Human Rights policy two years ago, which we believe was a first for any private correctional organization in the United States," Geo Group told CNNMoney in a statement.

CCA said its human rights policy is publicly available on its website and is incorporated into the ethics and professionalism course that every new employee receives.  "It has been shared across our organization in communications from our CEO and others in leadership," a CCA spokesman said.

Mercy has raised questions about food, housing and education for the detained children and adults.  "We've also been concerned about legal access for people," Heinonen said. Implementation and monitoring of human rights policies and transparency in communicating progress to investors is a work in progress.

"How often do the guards get a refresher course and what kind of oversight is there," Heinonen asked.  Mercy and the prison companies say they continue to meet regularly in order to address these issues. Mercy's relationship with prisons started out pretty warm and fuzzy.

"A number of orders have members who are chaplains in prisons and perhaps this conversation came from what these people saw," she said. Mercy initially focused on executive compensation. It introduced an investor resolution onto the ballot of both Geo Group and CCA, tying compensation to social as well as financial criteria.

"By the time we got started with the human rights policy, we had had had some success with other shareholder initiatives," Heinonen said. "For example, with the environmental initiative, everyone was recycling their waste."