Shareholder Campaign: General Electric
General Electric (GE) is a leading diversified manufacturer that markets a wide range of products for the generation, transmission, distribution, control, and use of electricity. Over the years, it has developed or acquired new technologies and services that have considerably broadened the scope of its activities. Most of the animal testing at GE was conducted by the company’s chemical division, either voluntarily or as part of government-sponsored testing programs, including the Environmental Protection Agency’s high production volume (HPV) chemical-testing program in which GE repeatedly ignored basic animal welfare protections.
2004 Resolution: ‘Give the Animals 5’
With the help of a PETA supporter who held stock in GE, a resolution was filed in the fall of 2003 calling on the company to “Give the Animals 5”—replace five crude and cruel animal tests with state-of-the-art and scientifically valid non-animal methods that were already in use in other countries.
PETA’s resolution garnered more than 229 million shares (3.86 percent), a number large enough to allow us to introduce the resolution again the following year.
2005 Resolution: ‘Give the Animals 5’
Despite its progressively worded “Animal Care and Use Policy,” GE again opposed our GTA5 resolution and sought permission from the Securities and Exchange Commission (SEC) to exclude our resolution from its proxy statement, arguing that it dealt with ordinary business matters that are not subject to a vote by stockholders. However, the SEC staff did not concur with any of the company’s arguments and ordered GE to publish the PETA-sponsored resolution in its shareholder proxy materials.
After the SEC’s ruling, PETA contacted GE’s corporate secretary in a good-faith effort to establish a constructive dialogue as an alternative to bringing our resolution forward at the company’s annual meeting. Despite a productive teleconference call and indications that GE might be amenable to a series of terms proposed by PETA in exchange for the voluntary withdrawal of our resolution, an agreement was never finalized. PETA’s resolution was brought to a vote at GE’s annual meeting and garnered almost 207 million shares (3.3 percent).
2006 Resolution: Animal Welfare Policy
In 2006, PETA filed a resolution with GE calling on the company to extend its animal welfare policy to include social and behavioral enrichment measures for the animals used both in-house and at contract testing laboratories.
The resolution was largely the result of the horrors uncovered in the independent contract testing laboratory Covance Inc., whose officials boasted that their clients included “just about every major company around the world.”
GE again challenged our resolution, partly on the grounds that since animals cannot communicate their own needs, the company was not responsible for addressing them. Again, the SEC ruled in PETA’s favor and ordered GE to publish the PETA-sponsored resolution in its shareholder proxy materials. GE published our resolution, along with its opposition statement advising shareholders to vote against it.
Negotiations with GE prior to the annual meeting resulted in withdrawal of the resolution; PETA and GE worked together to reduce the company’s use of animals and to improve environmental enrichment measures for the animals used. During this period, GE made great strides in instituting environmental enrichment programs with its contractors worldwide. However, when GE sold its chemical division and acquired Amersham, a UK-based pharmaceutical company, it cut off contact with PETA. Amersham has since become a part of GE Healthcare.
2010 Resolution: Transparency in Animal Use
As a result of GE’s refusal to work with PETA following its acquisition of Amersham, PETA filed a resolution calling on GE to establish a reporting system that includes the number and species of animals the company uses in experiments and information on the manner in which the company collaborates with FDA and other regulatory agencies to provide data from non-animal methods. GE excluded the resolution from the proxy materials, claiming that PETA did not provide proof of continuous ownership of GE stock. PETA disagreed, arguing that GE’s claim lacked merit as PETA provided sufficient proof at the time of submitting the resolution. Unfortunately, the SEC sided with GE, and the resolution was excluded from the proxy materials that year.
2011 Resolution: Transparency in Animal Use
Expanding upon PETA’s 2010 resolution, PETA’s 2011 resolution requested that the board issue an annual report to shareholders disclosing the number and species of all animals used in-house and at contract research laboratories and the company’ plans to reduce and phase out animal testing wherever possible.
GE asked the SEC for permission to exclude our resolution, alleging that the proposal was vague and indefinite in that it did not define or clarify the phrase “the use of animals” and did not “limit the scope of the report to activities undertaken by the Company.”
PETA argued that the resolution explicitly limited the scope of the requested report to animals used in-house and at contract laboratories by GE, and thus, GE was not unable to implement the resolution as it claimed, but rather was simply disinclined to do so. PETA argued that since unwillingness or disinterest in undertaking a task was not the same as an inability to do so, GE should not be allowed to exclude the proposal.
The SEC agreed with PETA, writing that it was “unable to conclude that the proposal and supporting statement, when read together, are so inherently vague or indefinite that neither the shareholders voting on the proposal, nor the company in implementing the proposal, would be [un]able to determine with any reasonable certainty what actions or measures the proposal requires.” In other words, the SEC did not agree that GE would lack the power or authority to implement the proposal, and the proposal was included in the proxy materials.
PETA’s resolution was brought to a vote and garnered almost 10 percent (452 million shares) and GE agreed to resume discussions with PETA.