Talking points for LD 1474

1. This bill adds to Maine's human rights legislation by protecting people against damage to the public interest by corporations. It also amends corporate charter law to make directors responsible for their corporation's impact on "the environment, human rights, public health and safety, welfare of the communities in which [it] operates [and] dignity of its employees."

2. Right now corporate charter law is interpreted by the courts to mean that directors of publicly held corporations have only one mandate: to maximize profits for the shareholders. This means if it is more profitable for a corporation to trample the public interest, then the directors must trample the public interest. This means that if directors are concerned about the welfare of their communities or minimizing pollution, they cannot bring those concerns to the table. This is malignantly absurd. The first good thing that LD 1474 would accomplish is to give directors legal "permission" to discuss and advocate for what they know is right.

3. This bill is not anti-corporation; it is pro-people. (The concept for it came from Bob Hinkley, a former Maine resident who was a corporate attorney for almost 25 years.) Small businesses take the community into account. LD 1474 lets big business act responsibly.

4. We need to foster sustainable businesses in Maine's communities--i.e., businesses that keep money here instead of funneling it away. MBNA is typical of one that funnels money away: it saw a 15 percent profit last year, but that was not enough, and so it is closing two more centers without regard for those communities. Even before this legislation's punitive measures kick in, it will encourage corporations and communities to expect corporate behavior that is healthy for the community.

5. We need to let corporations know that they can't trash our state on the way to taking profits out of it. Holtrachem and the Mallinckrodt pharmaceutical company, which Holtrachem once owned, are a prime example of "private profit and public expense." Across three decades, the companies released more than 25 tons of mercury into Orrington soils and the Penobscot River. When Mallinckrodt started dumping in the 1960s, mercury was known to be dangerous but releases were not regulated. LD 1474 says clearly that making profit at the expense of the public interest--as in disposing of a toxic heavy metal into soils and rivers--simply isn't acceptable. Had this law been on the books, dumping the mercury would have been an explicit violation of human rights. Without such legislation, Maine's taxpayers have had to pay for an expensive cleanup process at Holtrachem, and people living nearby or fishing in the river have encountered a serious and unnecessary health risk.

6. The code bill implicitly recognizes that small corporations tend to run closer to the bottom line and that large corporations have the greatest capacity to harm the public interest. While the legislation says that all corporations need to consider the public interest, only those with annual revenues greater than $15 million can be subject to punitive actions. Because owners of small, unincorporated businesses already are legally responsible for their impact on the environment and public health, this legislation will help level the playing field.

7. Even though this legislation broadens expectations for corporate behavior, it is kind to businesses that have to make a major transformation in the ways that they operate. There is no reason for a corporate exodus from Maine. Corporations will have years to make necessary changes; acknowledging that changes in corporate charter law must take place state by state and that a nationwide shift in corporate culture is needed, the bill says that punitive actions can't be taken until at least 25 other states have passed similar legislation. Moreover, no punitive action will be taken at all if the corporation corrects the harm it has caused. But from the day that this legislation is passed, it will encourage corporate directors to consider the public interest in ways that they never have and to prepare for the law's fuller meaning.

8. To read the bill, visit http://www.peoplefirstmaine.net/.