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Via PR newswire release: CtW Investment Group (Self described as an organization that "works with pension funds sponsored by unions affiliated with Change to Win, a federation of unions representing nearly 6 million members, to enhance long-term shareholder returns through active ownership.") has written a letter to a Whole Foods Board Director in which they call on the Board to replace John Mackey as CEO.

This is an amazing development, and never would have been possible without the groundswell of support for a boycott of Whole foods.

More discussion, and letter excerpts below the fold.

First, let me say that of course I realize that a union-affiliated organization would be anxious to criticizes the notoriously anti-union Whole Foods corporation.  

However, this letter is not appealing for unionization.  Rather, it is appealing as an enormously powerful long-term investor in Whole Foods stock.  In fact, the word "union" is only used in describing CtW Investment Group.

Here are some quotes from the letter (all emphases are mine):
(the original can be seen here)

Events of the past week establish yet again that John Mackey’s lack of personal discipline makes him a liability for Whole Foods Market, Inc.  Despite past indications that the board needed to exercise independent oversight of Mr. Mackey and supervise his external communications closely – most notably his postings on the Yahoo! Finance bulletin board, which led to an SEC inquiry – you and your fellow directors failed to take meaningful action to prevent Mr. Mackey’s uncompensated brand and reputational risk to our Company.

We therefore call on the board to immediately undertake the following:

   * Immediately remove Mr. Mackey as Chairman of the Board.

Whole Foods ... has benefitted from growing environmental and health consciousness among affluent urban consumers.  However, this leading position makes Whole Foods uniquely vulnerable to disaffection from these core customers if they perceive that the company is not managed in a manner consistent with their values.

While we respect Mr. Mackey’s First Amendment right to express his political views, as he did for instance in noting that the Constitution contains no "right" to health care, we hasten to point out that neither the First Amendment nor any other provision of the Constitution give Mr. Mackey or any other CEO the right to retain their position regardless of behavior or performance.  Moreover, Mr. Mackey’s article was not a citizen’s "letter to the editor," but a lengthy op-ed that explicitly tied him to Whole Foods by identifying him as the CEO.  Given Whole Foods’ unique exposure to a key segment of the customer base, Mr. Mackey’s decision to express his views in such a public way, and on an issue of such enormous moment, seems ill-advised at best.

we first called on the board to remove Mr. Mackey as chairman and to evaluate his suitability as director and CEO in a letter to you over two years ago.  In that letter, we specifically called the board to investigate whether Mr. Mackey’s Yahoo! Finance postings violated Whole Foods’ code of conduct and to establish clear disciplinary policies for unsanctioned executive communications.    Unfortunately, you failed to take any meaningful action, and now Whole Foods shareholders again face potentially damaging fallout from unmanaged and uncompensated reputational risk.

Similar inaction now is unacceptable. The board must act immediately to address the burgeoning crisis caused by Mr. Mackey’s undisciplined behavior or shareholders will have little option but to conclude that you and your fellow directors are unable or unwilling to hold management accountable.

Originally posted to Hopefully Skeptical on Tue Aug 25, 2009 at 04:51 PM PDT.

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