Religious Shareholders Force Disclosure by General Electric that Company Spent Tens of Millions to Delay Clean-up of Hudson River, Other PCB Site Discharges

New York, NY January 10, 2006. In the successful conclusion of a 10-year shareholder initiative, the Tri-State Coalition For Responsible Investment (Tri-CRI) announced today that it has been victorious in pressuring General Electric to reveal the $800 million the company spent from 1990-2005 during the period of time it sought to delay cleaning up toxic polychlorinated biphenyl (PCB) discharges at three sites: a 200-mile stretch of the Hudson River (the largest Superfund site in the U.S.); the Housatonic River in Pittsfield, MA.; and a former transformer facility in Rome, Georgia. In response to the long-overdue disclosure, the religious shareholders announced that they are withdrawing their 2006 GE shareholder resolution, which likely would have seen a repeat of the 27.4 percent support level religious shareholders achieved at the company’s 2005 annual meeting.
In a December 2005 letter to the SEC recently acquired by Tri-CRI, GE outlined the $799 million in PCB-related expenditures made by the company — including over $122 million spent on public relations/lobbying ($33.4 million), governmental relations ($2.1 million) and legal maneuvering ($86.6 million) –during the 1990-2005 period of time that it fought any efforts to clean up its discharges of the highly toxic PCB chemicals used in the electrical components.
The religious shareholders said that while GE deserved credit for belatedly acknowledging the extensive costs associated with its efforts to delay the clean up, it is now time for the company to undertake a full and extensive effort to rid the environment of its PCB contamination. Religious shareholders first started applying pressure on GE in 1996 to acknowledge its role in the PCB pollution discharges. [Trillium Asset Management co-filed the proposal from 2001 through 2005.] Thanks to foot dragging on the part of GE, it was not until 2000 that the Environmental Protection Agency ordered a clean up of the company’s PCB contamination of the Hudson River. Even then, the actual dredging was delayed until 2005 and then, once more, to the spring of 2007. Adding insult to injury, GE has only agreed to undertake 10 percent of the necessary clean up, indicating that it may seek to shirk the remaining nine-tenths of the required effort.
Sister Patricia Daly, executive director of the Tri-State Coalition for Responsible Investment (representing Catholic institutional investors in New York state, Connecticut and New Jersey), said: “General Electric deserves credit for finally coming clean about the costs of its stalling tactics on PCB contamination, but the reality is that $800 million would have gone a long, long way to cleaning up the problem if that money had not been wasted on PR, lobbying, and courtroom delaying tactics. Additional stalling is simply not a viable option here; GE needs to commit now to get the job done to clean up this very serious environmental and health problem as expeditiously as possible.”
New York Attorney General Eliot Spitzer: “I applaud Sister Pat Daly and the Tri-State Coalition for Responsible Investment for their efforts to obtain full disclosure from GE. We now know that the company spent tens of millions of dollars to lobby unsuccessfully against the clean up of the Hudson River. Now that a remediation plan has been approved, it is essential that the company not continue to spend millions more to scale back and further delay the project. Shareholders and the public deserve to know the cost of the company ‘s continued foot dragging.”
New York State Comptroller Alan Hevesi said: “It is time that General Electric changes its strategy from public relations to public responsibility for the cleanup of the Hudson River. Had the company invested in the cleanup at the same level it has fought the State of New York and its residents for the past 15 years, most of the work would have been completed. Congratulations to Sister Pat Daly and the Tri-State Coalition for their dedication to the cause of a clean Hudson River.”
Cathy Rowan, corporate responsibility coordinator, Maryknoll Sisters, said: “We welcome General Electric’s disclosure of its expenditures on PCB sites as an important step towards greater transparency and accountability on the part of GE to all its stakeholders.”
In a December 2005 letter to the Securities and Exchange Commission (SEC), GE disclosed the costs of its delaying tactics related to the Hudson River PCB pollution and additional PCB-contaminated sites at Pittsfield, MA., Rome, GA., Spokane, WA., Dewey Loeffel, NY and Canadian sites in Guelph and Davenport. The Hudson River, Pittsfield and Rome sites account for 89 percent of the delay-related costs, according to the letter filed by attorneys for GE. In its December letter, GE petitioned the SEC to use the disclosure sought by Tri-CRI as a basis for killing the related 2006 shareholder resolution. Since Tri-CRI had achieved what it was seeking in the proxy ballot measure, the 2006 resolution is being withdrawn.
The 2006 resolution was filed by the Dominican Sisters Caldwell, NJ and 26 additional co-filers: The American Baptist Churches, Valley Forge, PA; Sisters of St. Joseph of Carondelet, Albany, NY; Maryknoll Sisters, and Maryknoll Fathers and Brothers, Ossining, NY; Brothers of Holy Cross, New Rochelle, NY; Ursuline Sisters of the Roman Union, New Rochelle, NY; Society of St. Ursula, Rhinebeck, NY; Mercy Investment Program; Dominican Sisters of Hope, Newburgh, NY; Ursuline Sisters of Tildonk, Queens, NY; Dominican Sisters of Amityville, NY; Sisters of Charity of St. Vincent de Paul, NY; Sisters of Charity of St. Elizabeth, Convent Station, NJ; Sisters of Charity of the Blessed Virgin Mary, Dubuque, IA; Sisters of Mercy of Detroit, MI; Dominican Sisters of Columbus, OH; Sisters of Mercy of the Americas, St. Louis, MO; Sisters of St. Joseph of Carondelet, MO; Dominican Sisters of Great Bend, KS; Sisters of St. Joseph of LaGrange, IL; Sisters of the Sorrowful Mother, WI; Sisters of Charity of Cincinnati, OH; Sisters of St. Joseph, Philadelphia, PA; Socially Responsible Investment Coalition, San Antonio, TX; Clean Yield Group; and Green Century Funds.
PCBs do not degrade in the environment and continue to contaminate fish and other wildlife. PCBs are neurotoxic and have been linked to several types of cancer and immune system problems. The GE PCB contamination of the Hudson River forced the closing of the upper Hudson River to fishing in 1976. To this day, health advisories continue to warn people not to catch nearly all fish taken out of the river.
ABOUT TRI-CRI
The TRI-State Coalition for Responsible Investment is an alliance of more than 35 Roman Catholic institutional investors primarily located throughout the New York metropolitan area. Our members utilize their power as shareholders to hold corporations accountable to social and environmental concerns. In making decisions about managing resources and investments, Coalition members view local and global economies not only in terms of production and distribution, but also by their effects on the environment and the dignity of the human person. As religious investors, Coalition members take seriously their responsibility as shareholders to engage companies on a number of issues including ecological concerns, human rights, international health, international and domestic debt, equality and labor concerns, and militarism and violence.
ABOUT ICCR
For over 30 years the Interfaith Center on Corporate Responsibility (ICCR) has been a leader of the corporate social responsibility movement. ICCR ‘s membership is an association of 275 faith- based institutional investors, including national denominations, religious communities, pension funds, endowments, hospital corporations, economic development funds and publishing companies. ICCR and its members press companies to be socially and environmentally responsible. Each year ICCR- member religious institutional investors sponsor over 100 shareholder resolutions on major social and environmental issues. The combined portfolio value of ICCR ‘s member organizations is estimated to be $110 billion.
CONTACT: Patrick Mitchell, (703) 276-3266 or pmitchell@hastingsgroup.com.
EDITOR’S NOTE: Both a PDF file of the GE letter acknowledging the clean-up delay costs to shareholders and a streaming audio recording of today’s Tri-CRI news event will be available on the Web by 6 p.m. ET on January 10, 2006 at http://www.tricri.org .