Concerned Shareholders: Ford Acknowledges Global Warming Issue, General Motors Yet to Do So

Shareholders See Difference in Climate-Change Approaches at U.S. Automakers; Ford Handled Issue at Highest Level and Showed Flexibility, GM Yet to Act

DETROIT, May 7 -- The world's two leading automakers, Ford Motor Company and General Motors Corporation , appear to be heading down different roads when it comes to dealing with global warming. Based on a commitment by Ford to address the contribution of its product fleet to greenhouse gas emissions and also to help frame new policy alternatives to promote greater fuel efficiency, concerned shareholders are withdrawing a global warming resolution at the U.S. auto giant. At GM, however, the resolution will still be voted on when shareholders gather at the company's annual meeting scheduled for June 3, 2003.

In an unprecedented move, Ford Motor Company decided to publish the proposal and their response for shareholder review even after the resolution had been withdrawn. The precedent-setting Ford response acknowledges the importance of the global warming issue to its shareholders and pledges to work to address it. The company decided that it did not want to ask shareholders to vote against the resolution, a very different response from other companies facing the same resolution.

The resolution still in play at GM asks the automaker to measure and report to their shareholders on carbon dioxide -- "greenhouse gas" -- emissions from their plants and products, and also to commit to significantly reducing the emissions by 2012.

Resolution filers at Ford Motor Company were the Sisters of St. Dominic of Caldwell New Jersey, the United Church Foundation of the United Church of Christ, the Sisters of St. Joseph of Philadelphia, the Adrian Dominican Sisters, Christian Brothers Investment Services, and the Sisters of the Holy Cross, Notre Dame, among others. At General Motors, the Sisters of St. Dominic of Caldwell New Jersey and the United Church Foundation are joined as filers by the Missionary Oblates of Mary Immaculate, the Benedictine Sisters, the Sisters of St. Joseph of La Grange, Illinois, and the Jesuit Conference, among others.

Tri-State Coalition for Responsible Investment Executive Director Patricia Daly said:

"Ford chose to work on the elements of this resolution at the highest levels of the company rather than respond defensively as most corporations do. They have committed to reporting their emissions, their plans to reduce emissions and to work on the policy initiatives needed to successfully market fuel-efficient vehicles. They worked hard to develop a creative response here -- in a way that I have never seen a company do before."

Daly cautioned that the victory with Ford was only a first step, however, and said: "What will prove most important is that Ford follow through on that acknowledgement with a substantive commitment to reduce the total greenhouse gas emissions of their fleet."

Environmental groups that are working with both companies expressed cautious support for the withdrawal of the Ford resolution.

Mindy Lubber, Executive Director of CERES, a coalition of environmental organizations and investors, including the filers, that works with the companies, said: "We believe that both Ford and General Motors face material and reputational risk if they fail to address and reduce carbon dioxide emissions. The only way they're going to reduce that risk is to address it systematically, at all levels of the company, from product planning, to policy, to marketing. We hope these resolutions, whether they go forward or are withdrawn, will compel them to not only acknowledge the issue, as Ford as now done, but to deal with it in a proactive way."

Union of Concerned Scientists Executive Director and CERES board member Kevin Knobloch said: "The reason we're pressing these companies for a plan is that they've shown us that when they set goals, when they put their best minds on the case, they step up and meet that goal often below cost and ahead of schedule. Right now, both companies are showing interest in innovation, from introducing hybrid vehicles to working on fuel cells, but it's still not tied to the very serious problem of global climate change. This industry is tied to setting goals -- they don't design cars without setting targets and goals. So until they set a goal regarding climate change emissions, we can only conclude they're not serious."

The resolution that GM shareholders will vote on asks "that the Company report to shareholders (at reasonable cost and omitting proprietary information) by August 2003 on (a) estimated total annual greenhouse gas emissions (i) from our company's own operations and (ii) from its products; (b) how the company can significantly reduce greenhouse gas emissions from its fleet of vehicle product (using a 2002 baseline) by 2012 and 2020; and (c) an evaluation of what new public policies would enable and assist the company in achieving these emission reductions."

On December 11, 2002, concerned shareholder held a national telenews conference to announce the simultaneous filing of global warming resolutions at Ford and GM. Since that time, Ford took key steps to address some of the concerns of shareholders, who then elected to withdraw the resolution. No such progress has been achieved to date at GM.

BACKGROUND: GLOBAL WARMING AND THE AUTO INDUSTRY

Auto company carbon emissions comprise 20 percent of U.S. total emissions, which are 25 percent of world totals. In the model year 2000, General Motors and Ford Motor Company, respectively, bore the two highest "carbon burdens" of the top six automakers in the U.S. market. GM's carbon burden grew 13 percent between 1990 and 2000; Ford's grew 26 percent over the same decade.

The production, transportation and use of gasoline for cars and light trucks (SUVs, minivans, pick-ups) resulted in the emission of 302 million metric tons (MMT) of greenhouse gases by the U.S. in 2000. Cars and trucks are the largest single source of air pollution in most urban areas. Nearly 100 million Americans live in EPA-designated "air quality nonattainment areas" that expose them to unhealthy levels of ground-level ozone, particulate matter, sulfur dioxide and other pollutants.

American's heavy reliance on petroleum products to power vehicles also affects national security, as today more than half of the oil consumer in the U.S. is imported. U.S. cars and trucks consume 11 percent of the world's total oil production, and account for 40 percent of U.S. oil consumption.

FOR MORE INFORMATION: To hear a Web-based audio recording of the December 11, 2002 news event, go to www.hastingsgroup.com/GMFordGlobalWarming.html.