2016 Shareholder Resolution
Company: General Electric
Topic: Environmental (Other)

WHEREAS

from 1947-1977 General Electric (GE) released millions of pounds of Polychlorinated Biphenyls (PCBs) into the Hudson River;

The federal Comprehensive Environmental Response, Compensation and Liability Act (CERCLA) imposes liability for the release of hazardous substances, including: (1) cost of remediation necessary to prevent threat to human health and the environment; and (2) restoration and compensation costs for damaged natural resources (NRD);

WHEREAS,

in 2006, GE entered into a consent decree with the U.S. Environmental Protection Agency (EPA) to implement EPA’s 2002 Record of Decision (ROD) for the remediation of Hudson River sediments to achieve the following objectives, within certain timeframes: (1) reduce cancer and non-cancer health hazards for people eating fish from the river; (2) reduce concentration of PCBs in fish; (3) reduce PCB concentration in river water; (4) reduce the inventory of PCBs in sediments; and (5) minimize the long-term downstream transport of PCBs;

Utilizing extensive post-ROD project data, new analysis by the National Oceanic and Atmospheric Administration (NOAA), a federal NRD Trustee,1 finds greater than expected PCB concentrations and use of greatly overestimated rates of PCB decay in establishing the remedy, indicating that: (1) Hudson River fish will not meet the required targets; (2) post-remedial sediment surface concentrations in the Upper Hudson will be three-to-five times higher than anticipated;2

Questions regarding the legal sufficiency of the remedy in protecting human health and the environment may increase the risk of further post-remedial claims—including possible reopener of the remedy, public nuisance litigation related to navigability in the Champlain Canal, and citizen suits;

WHEREAS,

NOAA and other state and federal trustees have conducted extensive assessment of GE’s NRD liability for restoration of Hudson River ecological services and compensation for associated past and future public losses. Injuries to the public’s natural resources extend for over 200 miles and will continue decades after the cleanup is complete. For comparison, BP settled NRD claims related to the Deepwater Horizon oil spill—the closest parallel NRD site to the Hudson—for more than $8 billion;

GE may be able to reduce its cumulative NRD and other liability and expenditure of resources by addressing these disparate risks through a single cooperative NRD settlement that provides for additional dredging;

WHEREAS,

the uncertainty and costs of these potential future liabilities present a risk to our investment;

RESOLVED,

shareholders request that GE at reasonable expense undertake an independent evaluation and prepare an independent report by October 2016, demonstrating the company has assessed all potential sources of liability related to PCB discharges in the Hudson River, including all possible liability from NRD claims for PCB discharges, and offering conclusions on the most responsible and cost-effective way to address them.


1 The Hudson River Natural Resource Trustees are the Department of Environmental Conservation (NYSDEC), U.S. Fish and Wildlife Service (USFWS) and the National Park Service (NPS), and NOAA.

2 These concerns were also expressed in public comments from the federal trustees.


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