Greenpeace and a coalition of non-governmental organizations protested against Monsanto 27 January 2003, delivering thousands of messages stamped on paper plates.
The agrochemical giant Monsanto has received the lowest possible
environmental and strategic management rating of a triple-C from
Innovest Strategic Value Advisors, a global environmental and
social investment research firm. Innovest's report, "Monsanto and
Genetic Engineering: Risks to Investors," commissioned by
Greenpeace, was released at a briefing at the Harvard Club in New
York City this morning.
The report, which comes just days before Monsanto's annual
general meeting, warns shareholders and potential investors of
Monsanto's "above average risk exposure and less sophisticated
management than peers." Innovest analysts predict that "it
[Monsanto] will likely under-perform in the market over the mid to
long-term."
Monsanto suffered $ 1.7 billion in losses in 2002 and has failed
to open new markets for its controversial genetic engineered (GE)
products. Yet Monsanto continues to pursue its unsound business
strategy of betting on a speedy and widespread global acceptance of
GE foods. Next in the Monsanto pipeline is GE wheat, which is being
boycotted in key markets by farmers and food industry even before
its approval.
"While last year's profit losses led to a change in leadership
at the company, they did not lead to a change in strategy. If
Monsanto does not take steps to mitigate its substantial market
risks, further investor losses are likely," said Frank Dixon,
Managing Director at Innovest Strategic Value Advisors. "The risk
of heavy financial losses due to genetic pollution or technology
failure coupled with sustained market rejection of GE foods makes
Monsanto a poor investment."
In its assessment of Monsanto's key markets, Innovest
underscores the lack of regulatory approval and stiff consumer
opposition that continue to block the company's GE crops. GE
products constitute one of the most widely rejected product groups
ever, and major food importers such as China, Japan and Korea have
recently followed the restrictive European approach. In the US,
upwards of 90% of consumers now demand GE food to be labeled and
many would reject GE food if given the choice.
The Innovest analysis of the risks and liabilities associated
with Monsanto's genetic engineering (GE) business pays special
attention to the inevitability of GE contamination. Referring to
the example of the StarLink corn contamination scandal in 2000, in
which the company Aventis lost $1 billion, Innovest estimated
Monsanto's potential financial fallout from a "StarLink scenario"
to be $3.83 liability per share.
"Monsanto's cash cow remains its agrochemical business, but last
year's 24% drop in sales of Round-up and other non-selective
herbicides has left the company vulnerable and increasingly
desperate. Monsanto appears to be digging its own grave with its GE
strategy," said global markets specialist with Greenpeace, Lindsay
Keenan.
VVPR info: A comprehensive video on GE wheat market rejection, called "Slice of Life", is available from Greenpeace International, Martin Atkin +31 627 000 057The report can be downloaded from www.greenpeace.org/monsantoinvestor