Wilmington, Delaware
April 26, 2006
Christian Brothers
Investment Services (CBIS) said today that it has
achieved a "major step forward" with the 7.3 percent of
DuPont shareholders who
voted in favor of a resolution urging the company to
disclose any potentially material risk or "off-balance sheet
liability" that could be posed by its manufacturing and
distribution of food-related genetically modified organisms
(GMOs). With more than 480 million shares voting, the 7.3
percent of DuPont shareholders siding with the CBIS
resolution represents over $1.5 billion in shareholder
equity.
Reflecting what is almost
always a multi-year process of building shareholder awareness
and support, CBIS only needed 6 percent of shareholders to
support the GMO-related resolution in order for it to be
reintroduced for DuPont's 2007 annual meeting. As the CBIS
resolution notes, a wide variety of government, industry and
scientific experts have raised concerns about the lack of
adequate testing and controls in place in relation to the GMOs
unleashed by DuPont and other firms. Recent reports also have
raised potential health concerns -- including increased
incidence of allergies -- that could result from the
introduction of GMOs into agriculture and the food supply.
John K. S. Wilson, director of
socially responsible investing at Christian Brothers Investment
Services, Inc., said: "Today's vote gives CBIS and other
concerned groups considerable new leverage to keep up the
pressure on DuPont to determine and disclose the potential risks
associated with genetically modified agriculture. Our sole goal
here is to avoid a repeat of the Teflon controversy, which was
brought about when DuPont inaccurately asserted the safety of
perfluorooctanoic acid (PFOA) over many decades. At a minimum,
DuPont has an obligation to start acknowledging to its
shareholders that there are valid concerns here about potential
risks associated with GMOs."
In addition to citing recent
health concerns and regulatory problems with GMOs, the CBIS
resolution stated: "Disclosure of material information is a
fundamental principle of our capital markets. Investors, their
confidence in corporate bookkeeping shaken, are starting to
scrutinize other possible 'off- balance sheet' liabilities, such
as risks associated with activities harmful to human health and
the environment, that can impact long-term shareholder value.
SEC reporting requirements include disclosure of environmental
liabilities and of trends and uncertainties that the company
reasonably expects will have a material impact on revenues.
Public companies are now required to establish a system of
controls and procedures designed to ensure that financial
information required to be disclosed in SEC filings is recorded
and reported in a timely manner."
The CBIS resolution urged that
DuPont's "board of directors review and report to shareholders
by the 2007 annual meeting on the company's internal controls
related to potential adverse impacts associated with genetically
modified organisms, including: reviewing the adequacy of current
post- marketing monitoring systems; retaining an independent
environmental expert to review the effectiveness of established
risk management processes; and examining possible impact on seed
product integrity."
In outlining the potential
risks surrounding DuPont GMOs, the CBIS resolution goes on to
point out: "'Gone to Seed' [from the Union of Concerned
Scientists] reports that genetically engineered DNA is
contaminating U.S. traditional seed stocks of corn, soybeans and
canola, and that if left unchecked could disrupt agricultural
trade, unfairly burden the organic foods industry, and allow
hazardous materials into the food supply ... Insurers in
Germany, the UK and elsewhere are refusing liability coverage
for genetically engineered (GE) crops, demonstrating heightened
concern about the long-term safety of GE crops."
Christian Brothers
Investment Services, Inc. manages more than $4 billion,
combining faith and finance in the responsible stewardship of
Catholic financial assets. CBIS' combination of premier
institutional asset managers, diversified product offerings, and
careful risk- control strategies constitutes a unique investment
approach for Catholic institutions and their fiduciaries. CBIS
strives to integrate faith-based values into the investment
process through a disciplined approach to socially responsible
investing that includes principled purchasing (stock screens),
active ownership strategies (proxy voting, dialogues, and
shareholder resolutions) and community investment. The firm
contributes a portion of all profits to support the Church's
educational and social ministry. |