SOCIAL TOPICS (Archive): ENVIRONMENT

Published, July 2000

      Not business as usual best describes our recent actions that shook up the annual meeting of French-based minerals and materials company, Imerys. Representing shares held by Walden, Jyrki Raina of the International Federation of Chemical, Energy, Mine and General Workers’ Unions (ICEM) questioned Imerys management on its recent anti-union actions in the United States. The company has been historically union-friendly in France and Europe. This is the first time a social investment firm has pressed for workers’ rights before a French company’s annual meeting.

      Imerys was formed last year from the merger of Imetal and English China Clay, which operated plants in Sylacauga, Alabama. Prior to the merger, the workers of the Imetal plant were represented by the U.S. Paper, Allied-Industrial, Chemical & Energy Workers Union (PACE). ICEM is PACE’s international affiliate. Following the merger, Imerys withdrew recognition of the union. In discarding their collective bargaining agreement, the company claimed the workers were outnumbered by former non-union English China Clay workers. The U.S. National Labor Relations Board issued a complaint against Imerys in February, threatening to initiate prosecution of the company for allegedly violating the rights of employees to organize.

      At the annual meeting Mr. Raina recounted Imerys’ union-busting actions and urged management to allow the Sylacauga workers to vote on PACE representation. The emergence of social issues at a corporate annual meeting elicited press attention in France, and Joe Drexler, special projects director of PACE, told Walden, “We are in a much better position than we were six months ago because of the help we got from Walden Asset Management, the ICEM, and international labor.”

      On behalf of a Walden client we co-filed a resolution at U.K.-based BP Amoco asking the company to increase investment in solar energy and cancel all plans for future oil exploration and production in the Arctic National Wildlife Refuge. Led by Greenpeace, the resolution garnered support from 13.5 percent of voting shareholders — a strong message that shareholders deem investment in renewables an important part of the company’s current and future energy mix.

      Walden also co-filed a resolution at ExxonMobil, encouraging the company to increase its investment in renewable energy. ExxonMobil is becoming an outlier in its industry — one of the few integrated energy companies with no commitment to renewable energy sources.

      We saw it at the movies — and PG&E Corporation couldn’t evade its lack-luster environmental performance at its recent annual meeting. Through our proxy card to PG&E’s April meeting, Walden provided entry to Christine Albice (a colleague of Erin Brockovich) and two representatives of a local environmental group. Ms. Brockovich is practically a household name after being portrayed in the recent film named for her. The film depicts her involvement in a 1993 class-action lawsuit against PG&E, which culminated in a $333 million settlement — the largest in U.S. history. The lawsuit claimed that the utility had been for 30 years contaminating the groundwater of a small California community and creating health problems for the residents there.

      Prior to the annual meeting, Walden had written to PG&E to inquire about its standards for emissions of major air pollutants at its operations in New England. A number of these plants are not subject to stringent Clean Air Act regulations and local activists are lobbying PG&E to adopt voluntarily tougher emissions standards.

      The company did not address our questions about its mercury emissions, or the reportedly higher-than-average rate of hospital admissions for child asthma in Salem, Massachusetts, where the company operates the second most polluting power plant in that state. Walden will continue our follow-up with PG&E.

      Working with the social investment industry’s largest coalition composed of religious investors who are members of the Interfaith Center on Corporate Responsibility; other social investment firms, including Trillium Asset Management and Calvert Group; foundations and a labor union, Walden has for the third year co-led a shareholder resolution at The Home Depot seeking comprehensive disclosure of the company’s equal employment opportunity data. (The coalition was formed after Home Depot’s 1997 $114 million settlement of a class-action sex discrimination lawsuit.) Walden’s Heidi Soumerai introduced the resolution at Home Depot’s annual meeting in May.

      We have been encouraged by Home Depot’s recent programs designed to foster workforce diversity and have been impressed by its initial progress in increasing women and minority representation in management. Further, our pressure has led Home Depot to provide partial information about its equal employment opportunity status in its annual Social Responsibility Report. Nonetheless, we are disappointed that Home Depot has not yet embraced full public disclosure of diversity data.

      A meeting with management on the eve of the annual meeting, however, leaves us optimistic that Home Depot is heading toward greater disclosure and that our consistent pressure is exerting a positive influence on the company.

      Walden withdrew its EEO-1 disclosure resolution at Winn-Dixie Stores after the company responded by committing to change its policy regarding release of this data. Winn-Dixie will now disclose the information to interested investors. Our dialogue with Winn-Dixie began upon learning of a $33 million settlement in 1999 related to gender and race discrimination.

      This spring Walden led a meeting of 12 institutional shareholders and Coca-Cola representatives to discuss recycling initiatives. Since our discussions with the company last year, Coca-Cola has boosted the recycled content of its plastic bottles from less than one percent to 2 ˝ percent. We are encouraging the company to set goals in this regard and for recovery and recycling of plastic beverage containers. The company has opposed State bottle bills, which have garnered steep recycling rates, but has not provided significant support to achieving comparable container recovery rates through other mechanisms.