FOR IMMEDIATE RELEASE: APRIL 27, 2000 Media Contacts: Michael Passoff, As You Sow Foundation, (415) 391-3212 Dr. Ariane van Buren, Interfaith Center on Corporate Responsibility, (212) 870-2623 SHAREHOLDERS CHALLENGE KELLOGG OVER GENETICALLY ENGINEERED FOODS Annual shareholder meeting Friday, April 28, in Battle Creek, MI Resolution part of largest "Shareholder Movement" since South Africa Apartheid Battle Creek, MI -- "Why should Kellogg shareholders take a bullet for Monsanto?" asks Michael Passoff, of the As You Sow Foundation. The foundation is part of a shareholder group that has filed a resolution challenging the company over its use of genetically engineered foods. The resolution, which will be voted on Friday, asks the company to remove genetically engineered ingredients from their products until long term testing has proven them safe. It also proposes an interim step of labeling products that contain these ingredients. "Kellogg is putting its reputation and shareholders at risk," says Passoff. A letter sent to 2000 fellow shareholders, identified increasing financial, legal, and reputational liabilities to the company, as scientists raise new questions about the safety of gene altered foods and crops. It also points out that using these products limits Kellogg's market flexibility, as there is no consumer demand for gene altered foods, yet there is growing consumer backlash against them. "Kellogg derives no profit from these ingredients," says Passoff, "yet consumer concern is increasing and Kellogg has become the target of an international boycott led by Greenpeace." The shareholders claim that Kellogg's cost of phasing out of these products is negligible. Food stock is a very minor part of overall product cost - just pennies per cereal box. The vast majority of Kellogg's ingredients already come from regular crops, and the farm industry is improving its ability to segregate and identify between conventional and genetically engineered crops. Meanwhile, Kellogg's European operations, along with over 40 of Europe's largest food companies, are phasing out of genetically engineered products. U.S. and Canadian companies, including Frito Lay, Seagram, Heinz, Gerber, and Whole Foods have also pledged to remove these ingredients. "Kellogg is in a great position to take a leadership role on this issue and protect its brand name," says Passoff. "Will management wait until after the damage is done?" Also sent to shareholders was a report by the As You Sow Foundation, "Genetically Engineered Foods - Threats to Shareholder Value," which reviewed key financial indicators of the biotech food industry overall. The report showed a loss of market share, falling stock prices, an increase in consumer backlash and negative publicity, major legal and insurance liabilities, and an increase in government regulation. "Biotech foods is a industry in turmoil," said Passoff. "By using these products, Kellogg gets all the problems and no benefits." Resolution proponents are seeking support from shareholders concerned about their investment, as well as those concerned about the impacts of genetically engineered food based on health, environmental and ethical grounds. "Genetic engineering is a new, relatively untested technology that can have enormous impacts on the very fabric of life," said Rev. Gordon Judd, of the Sisters of Mercy Regional Community of Detroit, who is the resolution's primary filer. "Like all new technologies it offers potential and risks. Given the many unanswered questions about this technology, its widespread application to agriculture and food makes it a dangerous experiment that is being tested on consumers without their knowledge or consent." Rev. Judd will speak on behalf of the resolution at this Friday's shareholder meeting in Battle Creek, MI. Public health concerns have focused on allergic and toxic reactions, increased resistance to antibiotics, cancer risks, and reduced nutritional value. The socio-economic impacts, particularly for the world's poor, resulting from food monopolies controlled by a few multinational companies, raise serious social justice issues as well. Environmental problems already identified include genetic pollution, creation of "superweeds," and an increase in herbicide use and pesticide residue. There are also many unknown questions regarding long-term impacts on soil fertility, food webs and biodiversity. Kellogg is the latest company to face a proxy vote on this issue. Nearly two dozen similar resolutions were, or will be, filed with life science companies, food companies, restaurants, and supermarkets, including: American Home Products, Archer Daniels Midland, Campbell's Soup, Coca Cola, ConAgra, General Mills, Kroger, McDonald's, Monsanto, PepsiCo, Philip Morris (Kraft Foods), Procter & Gamble, Quaker Oats, Safeway, and Sara Lee. "Genetically engineered food has provoked the largest shareholder movement since South African apartheid," said Dr. Ariane van Buren of the Interfaith Center on Corporate Responsibility (ICCR), which has filed shareholder resolutions or initiated dialogues with 23 companies involved in the development and sale of genetically engineered foods. ICCR is a coalition of over 300 socially responsible investment firms and religious institutional investors with over $150 billion in combined assets. "This issue has drawn more shareholder participation and faster action than any other topic in the history of corporate social responsibility," said van Buren. "In less than half a year, the issue moved from no shareholder action to 23 different companies in the U.S. and abroad receiving shareholder proposals from 33 different investor groups." The Securities and Exchange Commission has ruled that companies may not omit the resolution and that genetic engineering of food is indeed a major policy issue for shareholders, and not ordinary company business. The SEC requirement for a resolution to receive enough votes to be refiled the following year is 3% for the first year, 6% for the second year, and 10% the third year. "Shareholder resolutions can often succeed with a small percentage of votes," says van Buren. "Successful resolutions are not measured in the typical electoral sense of receiving a majority vote, but by moving the company to act on an issue such as apartheid, sweatshops or environmental protection." -- END -- Simon Harris California Field Organizer Organic Consumers Association Tel: (415) 643-9592 Fax: (413) 793-0451 simon@organicconsumers.org Visit our website at: http://www.purefood.org