5.09.2007 - 02:00pm ET

(CSRwire) MIDLAND, MI- May 9, 2007- Shareholders of Dow Chemical (NYSE: DOW) representing $305 million will challenge CEO Andrew Liveris and top management at its annual stockholders’ meeting on Thursday, May 10, 2007, to address concerns about the company’s destructive impact on human health and the environment.

Stockholders will vote on three resolutions which raise serious concerns about the company’s ability to manage risks, reputational damage that could harm expansion plans, and failures to disclose material liabilities to investors. Two of the resolutions relate to contamination that Dow has failed to remediate – dioxin contamination in mid-Michigan and abandoned waste in Bhopal, India; the third resolution seeks to address the asthma epidemic and links to pesticides made by Dow.

The National Academy of Science recently re-affirmed that there is no safe threshold for the cancer-causing effects of dioxin. Evidence has accumulated that dioxin causes additionally dangerous health problems even at low levels, including developmental problems in children, immunologic problems in children and adults, reproductive problems, and diabetes. A study funded by Dow confirmed increased levels of dioxin in the blood of residents living in the contaminated floodplain downstream from Dow’s Midland plant, with median blood levels 28% higher than a comparison group. Yet according to a June 14, 2006 EPA document, "Dow's time frame for the implementation of final remedies is not reasonable or acceptable," and "[studies] are intended to delay the remediation process." Meanwhile, a class-action lawsuit by individuals representing 2,000 residents living along the Tittabawassee River and flood plain alleges that dioxin from the Midland plant threatens their health and lowers property values. The lawsuit seeks damages up to $100 million.

"As shareholders, we are concerned that the continued delays in Dow’s remediation of dioxin exposures near their flagship Midland facilities could lead to increased long-term liabilities… Dow's reluctance to address such a publicly documented contamination problem, especially in its own backyard, raises red flags about how the company deals with environmental and human health concerns more broadly," said Valerie Heinonen of the Sisters of Mercy Detroit, who filed the resolution on Midland contamination. "We are concerned that they are investing more in public relations than in efforts to provide real solutions."

Investors have expressed similar concerns about Dow's response to Bhopal. On the night of December 2, 1984, 27 tons of poisonous gas including methyl isocyanate leaked from a Union Carbide (UC) pesticide plant in Bhopal, India, taking the lives of more than 7,000 people within days, and resulting in an additional 15,000 deaths in the years since. Pollution continues to contaminate drinking water, and combined with long term effects of the disaster, has led to serious health problems for more than 100,000 people. Because UC is a fully-owned subsidiary, Dow has become the focus of survivors' efforts for justice, and multiple liability cases connected to Bhopal are pending.

New York City Comptroller William C. Thompson, Jr., who filed the resolution on Bhopal along with Amnesty International USA (AIUSA), said, "First and foremost, we must consider our fiduciary obligation, and that includes ensuring that the companies we invest in are responsible corporate citizens – not only in the communities where they operate today, but wherever their business decisions have impacted human lives. In Bhopal, India, Dow has inherited a legacy connected to Union Carbide, and we believe that addressing any outstanding liabilities that exist is absolutely necessary if Dow is to ensure expansion in the critical Indian market."

Dow's concerns about expansion in India were confirmed recently in a letter between Dow CEO Liveris and the Indian Ambassador Ronen Sen, uncovered by Bhopal advocates through the Right to Information Act. "This letter is strong evidence that Dow believes pending legal liabilities for the legacy of Bhopal present a barrier to investing in India, but the company has not disclosed this to its shareholders," said Sanford Lewis, an attorney who has represented Dow shareholders.

Added Neil Sardana, an AIUSA activist who is attending the shareholder meeting, "The fact is, while people are dying, Dow has shunted their responsibilities and looked to others to clean up their mess. The suffering in Bhopal is compounded by Dow’s refusal to disclose the chemical makeup of toxins that are poisoning people, making it impossible for them to receive adequate medical treatment."

Trillium Asset Management, which filed the resolution on asthma, has a similar complaint and is requesting a report analyzing the impact of Dow products linked to asthma, including end-use pesticides, pesticide active ingredients and other chemicals. The list of Dow pesticide products with ingredients linked to respiratory problems is long and Dow is the basic manufacturer of many active ingredients, including 2,4-D and chlorpyrifos. The Centers for Disease Control’s most recent National Report on Human Exposure to Environmental Chemicals found 93% of the U.S. population has chlorpyrifos metabolites in their bodies, and children ages 6-11 have exposure at four times the level EPA considers acceptable for long-term exposure. Additionally, more than 25% of the U.S. population has 2,4-D in their bodies, with children having the highest concentrations. In the opinion of the shareholder proponents, CDC’s data will aid the correlation of exposure to disease, and increase the likelihood of liability suits against Dow.

Proponents of these three resolutions believe that their concerns are interconnected, and that for Dow to become a truly ethical company – as described in its annual corporate citizenship report – it must address the full range of social and environmental issues. This also includes issues that were not represented on today’s ballot, such as legacy issues connected to Agent Orange in Vietnam and Nemagon use in Central America. Outside the shareholder meeting, activists representing a wide range of environmental and human health concerns will be protesting the apparent hypocrisy of Dow’s new "Human Element" ad campaign, demanding of Dow, "Where is the human element?"

The shareholders who filed the resolutions represent over 6.6 million shares including the New York City Pension Funds, New York State Common Retirement Fund (NYSCRF), Trillium Asset Management, Amnesty International USA (AIUSA), Dominican Sisters: Grand Rapids, Sisters of Holy Cross and Sisters of Mercy Regional Community of Detroit Charitable Trust.

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