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This excerpt taken from the SMG DEF 14A filed Dec 20, 2006. Shareholder’s
Statement in Support of the Proposal
Boston Common Asset Management, LLC (“Boston Common”),
84 State Street, Suite 1000, Boston, Massachusetts 02109,
claiming ownership of 8,100 common shares (as adjusted to
reflect the
2-for-1
stock split of the Company’s common shares distributed on
November 9, 2005) of the Company for more than one
year and John C. Harrington, P.O. Box 6108, Napa,
California
94581-1108,
claiming ownership of 200 common shares (as adjusted to reflect
the 2-for-1
stock split of the Company’s common shares distributed on
November 9, 2005) of the Company for more than one
year and stating that they will continue to hold the same
through the date of the Annual Meeting, have given notice that
they intend to present for action at the Annual Meeting the
following resolution (the “Shareholder Proposal”):
“Report on Efforts to Oppose Local Environmental Health
Policies
WHEREAS:
Scotts-Miracle-Gro (hereafter Scotts) established an
Environmental Stewardship Program in 2000 and named a Chief
Environmental Officer in 2004 who reports directly to the Chief
Executive Officer.
Scotts introduced a full line of environmentally friendly
products — Scotts Ecosense — in Canada,
where the Province of Quebec and major cities have restricted
pesticide use for lawn care.
Scotts recently introduced environmentally friendly products in
the United States, such as Nature’s
Care®
Insect Killer. These are marketed alongside toxic lawn care
products whose ingredients have been registered by the
U.S. Environmental Protection Agency. However, in the
opinion of the proponents, the EPA program does not sufficiently
address scientific concerns about pesticide safety. For example,
EPA’s program does not contain screens and tests for
hormone disrupting chemicals, as mandated by Congress in 1996.
Moreover, lawn care experts have stated roughly half of
homeowners admit they do not read or follow label directions
when applying pesticides and synthetic fertilizers to lawns,
leading to overuse and hazardous misuse of toxic chemicals.
Recognizing the shortcomings of federal pesticide regulation,
local governments in the United States are increasingly
considering following Canada’s example and enacting their
own limitations. State and local governments are also adopting
programs to reduce pesticide use in parks and public spaces.
Scotts’ Chief Environmental Officer Rick Martinez serves on
the Board of Directors of RISE, Responsible Industry for a Sound
Environment. RISE aggressively opposes local restrictions on
pesticide use. RISE Executive Director Allen James stated in
2005 that the organization is focusing particularly on six
states — New York, Connecticut, Maine, Wisconsin,
Minnesota and Washington — and in 2006 hired a new
“grassroots manager” to work on these issues. RISE
also filed suit to challenge restrictions enacted in the City of
Madison and Dane County, Wisconsin on “weed and feed”
products. Scotts and RISE also support “Project
Evergreen,” a nonprofit organization established to oppose
local pesticide and fertilizer restrictions.
Wal-Mart provided approximately 17% of Scotts’ revenues in
2005. Recognizing the business benefits from adopting safer
chemicals policies, Wal-Mart stated it will create product
safety scorecards and provide incentives for its buyers to
purchase environmentally-preferable products. Wal-Mart wishes to
spur competition among its suppliers to produce such products.
In the opinion of the proponents, Scotts’ opposition to
local environmental health policies on pesticides may be an
unduly costly activity which may cause reputational damage to
the Scott’s brand and compromise its retail relationships.
Table of Contents
RESOLVED:
Shareholders request that the Board of Directors report by
10/01/07, at reasonable cost and excluding confidential
information, the company’s annual expenditures by category
for each year from 1993 to 2005, for attorneys’ fees,
expert fees, lobbying, and public relations/media expenses,
relating to efforts to oppose local policies to limit lawn care
product use.
Supporting Statement:
Among other things, proponents urge that the report disclose
contributions to RISE, Project EverGreen, and other trade
associations, business organizations, and individuals, that may
be directed towards lobbying against local legislation or in
favor of state preemption of local legislation.”
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