General Electric Shareholder Proposal Wins an Astounding 21.8%(A)
Trillium Asset Management co-filed in solidarity with over 30 members of the Interfaith Center on Corporate Responsibility and the New York City pension funds a shareholder resolution requesting GE to disclose the costs of delaying its cleanup of PCBs in the Hudson River. The environmental shareholder proposal won a remarkable 21.8% of the shareholder vote at GE’s Annual General Meeting on April 24th. Last year the resolution won 11%.
In his first meeting as CEO, Jeffrey Immelt was questioned by Sister Patricia Daly, Executive Director of the Tri-State Coalition for Responsible Investment, if he would express the company’s desire to cooperate with the EPA by dropping its lawsuit challenging the constitutionality of the Superfund law; not surprisingly he declined.
Another environmental shareholder proposal requesting the company to report on climate change issues received a very strong 19.1% of the vote. Says Daly, “These votes reflect new support from institutional investors. I believe this is a result of a new appreciation for the financial ramifications of social and ecological issues. Let’s us not underestimate however, that the call for greater disclosure and reporting to shareholders is a reasonable demand in this post-Enron world.”
Earlier this year, after years of pressure from environmentalists and religious shareholders, General Electric finally agreed to cooperate with an order from the Environmental Protection Agency (EPA) to dredge tons of toxic PCBs from the Hudson River. On February 1, EPA Administrator Christie Whitman finalized the plan proposed 14 months prior by the Clinton administration. While the company does not believe that dredging is appropriate, its spokesman told the New York Times it wants to play “a constructive role.”
The company had spent millions of dollars on advertising and lobbying against the plan. The company’s new CEO Jeffrey Immelt announced in January 2002 that the company had set aside the money for the dredging. The $500 million cleanup along a 40-mile stretch of the Hudson River north of Albany, N.Y., will be one of the largest dredging operations ever. GE dumped 1.3 million pounds of PCBs into the river from its plants in Fort Edward and Hudson Falls, N.Y., before the federal government banned the substance in 1977. The EPA classifies PCBs as a probable carcinogen and says they pose a risk to people who eat fish from the Hudson.
Over the next three years the EPA will design the particulars of the plan, which calls for dredging 2.65 million cubic yards of contaminated sediment — enough to fill about 40 football fields 30 feet deep — and is expected to remove 150,000 pounds of PCBs.
The company has no plans to challenge the decision, and environmental lawyers report they would be unsuccessful should they try, as the Superfund law, under which the cleanup was ordered, essentially bans lawsuits. However, the company does have a lawsuit pending in U.S. District Court challenging the constitutionality of the federal Superfund law itself.
Friends of a Clean Hudson, a coalition of 11 environmental groups, say the cleanup is critical for the health of millions of Hudson Valley residents. New York Governor George Pataki fully supports the decision. For more information, visit the web sites of the Environmental Protection Agency, and Friends of A Clean Hudson.
Sources for this article include: “GE, EPA to Dredge Hudson of PCBs,” The New York Times, 2/1/02; and Sister Patricia Daly, Executive Director of the Tri-State Coalition for Responsible Investment.