AGENDA ITEM 5: STOCKHOLDER PROPOSAL FOR REPORT ON GENETICALLY ENGINEERED SEED |
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Stockholders have stated that their representative intends to present the following proposal at the Annual Meeting. The Company will promptly provide the names and addresses of the stockholders and the number of shares owned upon request directed to the Corporate Secretary. Dow is not responsible for the contents of the proposal. If properly presented at the Annual Meeting, your Board unanimously recommends a vote AGAINST the following proposal.
Stockholder Resolution
Whereas: 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. Company directors and officers must proactively identify and assess trends or uncertainties that may adversely impact their revenues and disclose the information to shareholders. 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.
Resolved: That shareholders request the board of directors to review and report to shareholders by November 2008, on the company’s internal controls related to potential adverse impacts associated with genetically engineered organisms, including:
- adequacy of current post-marketing monitoring systems;
- adequacy of plans for removing GE seed from the ecosystem should circumstances so require;
- possible impact on all Dow seed product integrity;
- effectiveness of established risk management processes for different environments and agricultural systems.
Supporting Statement
Dow’s seed producing investment significantly increased with:
- corn seed licensing pact with Monsanto (9/14/07);
- acquisition of the corn division of Agromen Tecnologia Ltda, a large Brazilian seed company (Gazeta mercantil, 8/2/07);
- acquisition of Netherlands‑based Duo Maize. (8/30/07);
- acquisition of the Austrian affiliate of Maize Technologies International (MTI) an Austrian based corn seed company, as well as ownership of MTI’s French affiliate and other related assets. (5/1/07)
Producers of GE-seeds are merely encouraged to have voluntary safety consultations with the FDA. The FDA does not issue assurances as to the safety of these products.
According to Safety of Genetically Engineered Foods: Approaches to Assessing Unintended Health Effects (National Academy of Sciences [NAS] 7/2004: “...there remain sizable gaps in our ability to identify... unintended adverse effects on human health [of genetically modified organisms].”
No post-marketing surveillance is required to verify results of pre-market screening for unanticipated adverse health consequences from the consumption of GE food (NAS 7/2004) or environmental impacts from the production of GE crops.
Gone to Seed (Union of Concerned Scientists) reports that GE-DNA is contaminating U.S. traditional seed stocks, of corn, soybeans and canola...left unchecked could disrupt agricultural trade, unfairly burden the organic foods industry, and allow hazardous materials in the food supply.
Three court rulings question the adequacy of USDA’s oversight of GE crops:
- Judge Breyer, Federal Dist. Court, ruled USDA failed to adequately assess potential environmental impact of GE alfalfa (2/13/07)
- US Judge Henry Kennedy ordered USDA to more thoroughly review applications for GE field trials. (2/5/07)
- Federal District Court ruled that USDA’s permitting of drug-producing GE crops in Hawaii violated the Endangered Species Act and the National Environmental Policy Act. (8/10/06)
Company’s Statement and Recommendation [top]
Your Board of Directors unanimously recommends a vote AGAINST this proposal.
Dow’s commercial ventures in biotechnology include transgenic corn, soybean, cotton, alfalfa and canola. Dow believes these products are well-regulated and generate significant positive economic, social and environmental contributions to our society.
The benefits of crop biotechnology are demonstrated by its broad adoption by farmers around the world. In 2007, these crops were planted by more than twelve million farmers on more than 280 million acres in 23 countries. (C. James, ISAAA, 2007.)
Novel biotech products are subject to extensive review and rigorous health, safety and environmental testing prior to regulatory approval. Throughout the past decade, these products have been widely grown and consumed in the United States without harm to health or the environment. Dow believes this is in itself a demonstration of their safety and of the effectiveness of the regulatory system that permits and oversees the products.
All of Dow’s agricultural biotech products have been successfully reviewed by the appropriate U.S. regulatory agencies. The U.S. Food and Drug Administration oversees these products to ensure food safety. The U.S. Department of Agriculture regulates them in terms of environmental safety, including field testing (a joint responsibility with the Environmental Protection Agency (“EPA”)), and transportation and importation. The EPA regulates pesticide‑active biotech products for human and environmental safety including field testing, proper use and stewardship. Final authorizations for the Company’s products have been granted only following completion of all required human health and environmental studies and after successful conclusion of regulatory reviews encompassing the research, development and commercialization of these products. Also, following commercialization, Dow continues to monitor its products for specific environmental effects.
In addition to regulatory review in the United States, products of crop biotechnology are subjected to detailed scientific scrutiny and oversight by importing nations, prior to their introduction. Regulatory processes for review and approval of agricultural biotechnology products are already in place in many countries, including Australia, Argentina, Brazil, Burkina Faso, Canada, China, Colombia, the countries of the European Union, Honduras, Indonesia, India, Japan, Korea, Mexico, New Zealand, Paraguay, the Philippines, Singapore, South Africa, Switzerland, Taiwan, Thailand and Uruguay, and are rapidly being developed in other nations. After these products have been commercialized, Dow is required by law to report any adverse human health or environmental effects noted anywhere in the world to U.S. regulatory authorities.
Consistent with Responsible Care® and our internal Guiding Principles for Biotechnology, Dow is committed to making health, safety and environmental protection an integral part of the design, production, marketing and distribution of all our products. Each product receives an internal risk assessment prior to commercialization, and the Company’s processes are designed to ensure good stewardship. Also, Dow is leading industry-wide efforts to further enhance stewardship programs globally and follows the Biotechnology Industry Organization’s Product Launch Stewardship Policy developed to facilitate the introduction of novel biotech products to the marketplace.
Dow has quality management systems in place to monitor seed purity and to facilitate compliance with applicable governmental standards and regulations. The primary focus of these systems is on prevention, supported by proactive and sustained stakeholder outreach, communications and education. Through an extensive and effective in-field monitoring system, Dow is also well prepared to identify and manage potential issues after product commercialization through isolation and elimination of any unwanted material. These practices and principles represent an essential foundation for any successful biotechnology business.
In support of robust science‑based regulations, and to better define proper use and stewardship requirements for each product, the Company engages in proactive dialogue with customers, scientists, policymakers and other stakeholders. In countries with evolving regulatory systems, such as Mexico, Dow provides government authorities with relevant studies assessing the safety of its products prior to seeking approvals for commercialization. Studies above and beyond those required by regulators are often performed by the Company to ensure product integrity, consumer confidence and adherence to high standards of stewardship.
As an augment to the extensive information offered to the public by U.S. regulatory authorities, Dow already provides a wide range of communications on its agricultural biotechnology products, including specifics on product use and safety, insect resistance management and grain marketing guidelines. This information is available on the Internet, through published papers and through direct communications to customers and other interested parties. Additionally, the Company actively leads or supports a number of educational programs initiated by third‑party or industry groups. These programs are designed to communicate the benefits of agricultural biotechnology, promote its effective and responsible use, and maintain the integrity of markets through effective grain marketing and stewardship.
For all of these reasons, your Board believes that this proposal is not in the best interests of Dow or its stockholders. Accordingly, your Board unanimously recommends a vote AGAINST this proposal.
Vote Required
Approval of the resolution requires a majority of votes actually cast on the matter. For purposes of determining the number of votes cast on the matter, only those cast “for” and “against” are included, while abstentions and broker non-votes are not included.
® Responsible Care is a service mark of the American Chemistry Council in the United States.