Large Dow Shareholder Vote Urges Transparency on Cleanup

 

May 15, 2008

 

Contact: Sanford Lewis
 Stategic Council on Corporate Accountability

413 549-7333

 

Midland, Michigan.  More than 22% of Dow's voting shareholders voted to urge the company to report on progress to clean up a massive contamination site at Dow's mid-Michigan global headquarters.

 

Shareholders were responding to a resolution forwarded by the Sisters of Mercy challenging the company's potential liabilities associated with the slow pace of cleanup.  The vote follows on the heels of a Congressional investigation into claims by the ousted EPA Regional Director that she was removed from office for requiring the company to remove contaminated sediments, and to further test for dioxin.

 

The resolution, which required the company to "issue a report to shareholders...summarizing the pace and effectiveness of the environmental remediation process being undertaken by Dow in the vicinity of and downstream from its Midland headquarters," garnered unusual support, "according to the preliminary count of votes reported  by the company at the meeting.  Shareholder resolutions requiring reports of this

nature typically garner 3-10% of voting shares.

 

Shareholders may be concerned about potential ongoing liability from the company's handling of the more than 50-mile long contamination stretching from the company's headquarters to the Saginaw Bay.  Fish and wildgame in the region are contaminated.  A wildgame advisory in the region was extended last week to include additional species.  Area residents have elevated levels of dioxin in their blood when compared with a comparison population.  In a high profile move this past year, the company was required by the Environmental Protection Agency to remove highly contaminated "hot spots" from the river.    Also in the last year, the highest level of dioxin ever measured in the country was found in the river.

 

Dow's response has been to downplay the hazards of dioxin, the toxic compound which characterizes the contamination.  Dow has also sought to negotiate behind closed doors, outside of public scrutiny.

 

"We believe this vote for the second year in a row signals an interest in a more forthright approach to protect shareholder value," said Valerie Heinonen of the Sisters of Mercy Detroit, who filed the resolution on Midland contamination.   "As shareholders, we are concerned that the continued delays in Dow's remediation of dioxin exposures near their flagship Midland facilities could lead to increased long-term liabilities. Dow's reluctance to address such a publicly documented contamination problem, especially in its own backyard, raises red flags about how the company deals with environmental and human health concerns more broadly." She continued, "we are concerned that they are investing more in public relations than in efforts to provide real solutions."

 

Protesters held banners outside the event saying "We are the human element," playing on Dow's multi-million dollar ad campaign.

 

"When more than 22% of Dow's 939 million shares voted for more transparency and action on this issue, the company should take notice," said Sanford Lewis, attorney, who drafted the resolution.  "The company has appeared in a series of high profile negative media stories related to the contamination.  The reputational damage to the company is significant, and suggests a resolution to this issue is long overdue."

 

##