SAN FRANCISCO, CA. //April 22, 2008// An unprecedented coalition of 21 health and environment groups -- including Breast Cancer Fund, the American Nurses Association, the Institute for Children’s Environment Health, Friends of the Earth and Greenpeace -- are joining with Pesticide Action Network North America (PAN) to encourage mutual funds to support resolutions that urge both Dow Chemical Company (NYSE: DOW) and Avon Products (NYSE: AVP) to come clean about toxic chemical risks.
Among the 23 fund families targeted by the groups are those at Vanguard, Fidelity, Bank of America and Bank of New York Mellon. A shareholder resolution on nanomaterials risks is scheduled to be voted on at the Avon annual meeting on May 1, 2008. The Dow proxy item on pesticides linked to asthma will be voted on by shareholders on May 15, 2008.
The joint letter states: “These investor proposals are intended to protect and enhance shareholder value; as one of the largest shareholders of one or both of these companies, we are writing to encourage your fund to consider both the business and public health cases favoring them … Exposing consumers to toxic chemicals, frequently without their knowledge, companies run real business risks, including costs of recalls, damaged reputations, litigation, and loss of market share. We are bringing to your attention the Avon and Dow Chemical shareholder resolutions … because they provide excellent opportunities for your Fund to vote in favor of resolutions with both a strong financial and public health basis.”
PAN Managing Director Stephen Scholl-Buckwald said: “In recent years, most mutual funds have routinely voted against or abstained from shareholder resolutions seeking greater disclosure or action on product toxicity concerns. Funds have evidently given little or no consideration to the financial hazards stemming from such toxic product liabilities. In their blanket opposition to addressing toxic risk, funds may appear to be reflexively voting with management, indifferent to the financial implications as well as to shareholders’ and consumers’ preferences for less-toxic consumer products. With the significant benefit to shareholders and the company of increased transparency and disclosure, and the minimal cost for preparing the requested reports, there is every reason to vote in favor of the Avon Products and Dow proposals.”
The full list of groups signing the joint letter (in alphabetical order) is as follows:
- Advocates for Environmental Human Rights
- American Association of Intellectual and Developmental Disabilities (formerly AAMR)
- American Nurses Association
- Beyond Pesticides
- Breast Cancer Fund
- Center for Health, Environment, and Justice
- Clean New York
- Connecticut Coalition for Environmental Justice
- Coop America
- Environmental Health Fund
- Friends of the Earth
- Global Community Monitor
- Green Decade Coalition
- Greenpeace
- Health Care Without Harm—Boston
- Healthy Buildings Network
- Institute for Children’s Environmental Health
- Maryland Pesticide Network
- Kentucky Environmental Foundation
- Pesticide Action Network North America
- Women’s Voices for the Earth
The full list of funds receiving the joint letter (in alphabetical order) is as follows:
- Allianz Global Investors of America L.P.
- Ameriprise Financial
- AXA Financial
- Bank of America
- Bank of New York Mellon Corporation
- Barclays Global Investors UK Holdings Ltd
- Brandes Investment Partners L.P.
- The Capital Group Companies
- Davis Selected Advisers
- Dodge & Cox Inc.
- FMR LLC
- Franklin Resources, Inc
- Harris Associates
- Janus Capital Management, LLC
- LSV Asset Management
- Northern Trust Corporation
- Oakmark Equity and Income Fund
- Price (T. Rowe) Associates, Inc.
- State Street Corporation
- TCW Group, Inc. (The) US
- The Vanguard Group, Inc
- Washington Mutual Investors Fund
- Wellington Management Company, LLP
BACKGROUND ON THE RESOLUTIONS
The Avon resolution, Question 4 on the company’s proxy statement, requests a report to shareholders on the company’s policies on nanomaterial product safety. Avon has defended its use of nanoparticles in sunscreens, while the scientific community has raised serious questions about the adequacy of testing. (The term “nanomaterials” refers to particles smaller than 1000 nanometers (nm).) However, ISS/Riskmetrics recently recommended a vote by shareholders in favor of the Avon resolution, noting that “while Avon Products does provide a Product Safety policy, it does not provide shareholders with the details of initiatives and processes which ensure the efficacy of its stated global product safety standard…. Such commitments on the part of management could help mitigate future regulatory, legal, and reputational risks.” Of the use of nanoparticles by Avon, Wall Street advisory firm Innovest Strategic Value Advisors recently identified titanium dioxide as a financial risk.
The Dow Chemical resolution, Question 3 on the company’s proxy statement, seeks a report to shareholders on the extent to which Dow products may cause or exacerbate asthma and the company’s policies and activities to phase out or restrict materials linked with such effects. Approximately half of Dow’s end-use pesticide products (73 of 149) may be linked to asthma and other respiratory problems through active or inert ingredients or metabolites.
According to a 2004 study in the journal Environmental Health Perspectives, published by the National Institute for Environmental Health Sciences at NIH, pesticides are both a trigger and root cause of asthma. Researchers discovered that children exposed to herbicides are four and a half times more likely to be diagnosed with asthma before age five; toddlers exposed to insecticides are over two times more likely to get asthma. The Centers for Disease Control and Prevention (CDC) state that nearly one in eight school-aged children have asthma, the leading cause of school absenteeism due to chronic illness. Children are more susceptible than adults to asthma; lungs do not fully develop until at least the eighth year after birth, making a child vulnerable to pesticides and other pollutants linked to asthma. The number of children dying from asthma increased almost threefold from 1979 to 1996. The estimated annual cost of treating childhood asthma is $3.2 billion.
ABOUT Pesticide Action Network
Pesticides are hazardous to human health and the environment, undermine local and global food security and threaten agricultural biodiversity. Yet these pervasive chemicals are aggressively promoted by multinational corporations, government agencies, and other players in this more than $35 billion a year industry. PAN (Pesticide Action Network North America) works to replace use of the most hazardous pesticides with ecologically sound and socially just alternatives. As one of five autonomous PAN Regional Centers worldwide, we link local and international consumer, labor, health, environment and agriculture groups into an international citizens' action network. This network challenges the global proliferation of pesticides, defends basic rights to health and environmental quality, and works to ensure the transition to a just and viable society. For more information, go to http://www.panna.org.
CONTACT: Stephen Scholl-Buckwald, for PANNA, (415) 981-1771; (mobile) 415-203-4455; or steveatpan@panna.org
EDITOR’S NOTE: The full text of the letter from PANNA and 20 other groups is available HERE. The letter includes background on the Avon and Dow resolutions, as well as the full list of co-signers.
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