A Catholic investment firm wants one of the world’s largest seed companies to go to confession.
Christian Brothers Investment Services Inc., or CBIS, a U.S. investment advisory firm that manages $4 billion US on behalf of more than 1,000 Catholic institutions, wants DuPont to be more forthcoming about the genetically modified crop side of its business.
The investment firm, which operates under a mandate of unifying faith and finance, uses its investment clout to encourage firms to become better corporate citizens.
CBIS is using its 65,456 shares of DuPont to file a shareholder resolution asking the company to provide a detailed explanation of how it is protecting shareholders from potential liability issues posed by its manufacture and distribution of GM foods.
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DuPont owns Pioneer Hi-Bred International Inc., which sells GM corn, soybeans and canola.
CBIS said DuPont hasn’t done a satisfactory job of meeting the legal requirement to inform investors about the potential environmental contamination and health-related liabilities.
“They have the right to know if GMOs have the potential to pose a major long-term threat to their wealth and if so, how big that potential risk is to the pocketbooks of those of us who own DuPont,” said John Wilson, director of socially responsible investing at CBIS.
The resolution, which will be voted on at the company’s annual meeting on April 26, calls on DuPont’s board of directors to report to shareholders by the 2007 annual meeting the company’s internal controls related to the potential adverse impacts of its GM crops.
DuPont has advised its shareholders to vote down the resolution, claiming adequate controls are already in place.
“Each new product undergoes a myriad of laboratory and field tests at every stage of development and commercialization, with such testing lasting for a period of seven to 10 years,” said the company in a letter to shareholders.
In addition to its own tests, DuPont said it has complied with federal regulations and has an ongoing product stewardship program in place.
“The board therefore believes that the concerns raised in the proposal are already being satisfied,” said the letter.
CBIS wants the company to do more, including reviewing the adequacy of its post-marketing monitoring systems and implementing a mandatory labelling system for its GM products.
Wilson said the company has done the pre-market legwork but has fallen down when it comes to post-market monitoring. He drew a parallel to DuPont’s Teflon controversy.
The chemical company recently reached a settlement with the U.S. Environmental Protection Agency over charges it had concealed the possible harmful effects of perfluorooctanoic acid, a chemical detected in minute quantities in its Teflon cookware.
“We don’t have to have a repeat of the decades of denial and foot-dragging and false reassurances that got us to where the Teflon situation is today,” said Wilson.
The CBIS proposal has the backing of the Interfaith Center on Corporate Responsibility, an association of 275 faith-based institutional investors with an estimated $110 billion in assets. The centre’s members have tabled similar resolutions with Monsanto and Dow AgroSciences.
