From: GBurch1@aol.com
Date: Thu Dec 23 1999 - 18:11:27 MST
The Guardian (Finance).
Corporate America faces GM onslaught
Shareholders demand a ban
Roger Cowe
Monday December 20, 1999
A concerted shareholder campaign against genetically modified (GM) foods is
about to hit corporate America with a flood of resolutions at company
meetings demanding a moratorium until proper testing has been done.
Shareholder groups have initially targeted 24 companies operating
throughout the food chain, including household names such as Coca-Cola,
Heinz, the US Safeway chain and McDonald's, as well as Monsanto, the life
science group at the centre of the controversy because of its GM soya.
European groups are also under pressure, including Diageo, the Pillsbury
and Burger King group.
Shareholders have submitted resolutions for these companies' annual
meetings in the spring, demanding that they stop marketing or distributing
GM products until long-term safety testing has ruled out harm to humans,
animals, or the environment. Pending complete withdrawal, they demand
labelling of food products so that consumers can avoid GM ingredients if
they wish.
The campaign is being co-ordinated by the Interfaith Center on Corporate
Responsibility (ICCR), an umbrella body for 275 religious and other groups
which claims to control $100bn of shares in US companies. The ICCR has led
a number of successful shareholder campaigns, including withdrawal from
South Africa, action against tobacco products and pressure for companies to
adopt environmental policies.
Ariane van Buren, ICCR's director of energy and environmental programmes,
said opposition to GM foods was growing strongly in the US, fed by success
in Europe.
"The action in Europe has been a very important precedent", she said. "This
is going to grow and companies need to think it through."
She said an attempt to have the resolutions ruled out of order was a
routine blocking tactic, but was unlikely to succeed because shareholders
could demonstrate they had a right to know company policies in this area.
The campaign has cited decisions to exclude GM ingredients by Sainsbury and
Tesco as well as the UK arms of fast food chains McDonald's, Burger King
and Kentucky Fried Chicken.
In a letter to chief executives of the targeted companies, the campaigners
quote these examples and ask: "How does this company plan to respond to
popular challenges to the production, use or sale of genetically modified
food?"
They raise questions of health and safety, loss of control over seeds by
farmers, consumers' right to know what is in their food, and fears about
the long term ecological impact of genetic modifications. In a supporting
statement to the resolution demanding a moratorium, the groups raise
the financial risk to companies which persevere with GM products.
They say: "Our company should take a leadership position in delaying market
adoption of genetically engineered crops and foods. Failure to do so could
leave our company financially liable."
Ms van Buren said companies usually tried to reach agreement before the
annual meeting with shareholders backing such resolutions.
But she believes that most US companies still do not understand the power
of consumer resistance and will be unlikely to offer big enough concessions
to satisfy shareholders.
"There's a good chance we are not going to get an offer which is
significant enough. They have been caught off guard - even now. They are
surprised at the shareholder reaction. I can't believe they are so naive."
The targeted companies include life science groups American Home Products,
Dow Chemical and Du Pont, the food ingredients company Archer Daniels
Midland, consumer products groups General Mills, PepsiCo, Philip Morris,
Quaker Oats, and Sara Lee. European groups in the firing line in addition
to Diageo include Hoechst, Novartis, Rhone Poulenc and Schering.
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