Latest EPA Toxic Emissions Data Added to
Socrates profiles

KLD has updated its SOCRATES research tool with the Environmental Protection Agency's (EPA) 2003 Toxic Release Inventory data, the most recent data available. As a result of the project, 105 of the companies covered in SOCRATES now have received a "concern" rating for Substantial Emissions.

The EPA's Toxics Release Inventory is an outgrowth of the federal Emergency Planning and Community Right-to-Know Act (EPCRA), which was enacted in 1986 amidst growing concern about toxic chemicals following the deadly 1984 Bhopal, India chemical disaster. The TRI annually reports data on approximately 650 toxic pollutants that companies are permitted to release to the air, water, and land. In 1998 several new industries were required to report their emissions data under TRI. Important players among these included electric energy generators, mining operations and waste management companies. Some of these industries have among the highest TRI releases. TRI data help inform communities of chemical hazards in their areas, but the data also provide an important metric for social investors interested in evaluating a company’s impact on the environment.

The top four KLD industries with the largest number of substantial emissions concerns in order were electrical utilities, chemicals, steel, and drugs and pharmaceuticals. Seventy of the companies receiving concerns were members of the S&P 500, and 13 were members of KLD's DS 400 Index.

According to the EPA, the top five polluting companies in the United States accounted for 60% of the total TRI emissions. Four out of five of those companies were mining companies. The EPA also reported on its website that electric utilities accounted for 33 out of the top 35 emitters to air. Food companies accounted for 18 of the top 35 emitters to water. Plastics and Resins companies accounted for the top 28 out of 35 top emitters to underground injection wells. Mining companies accounted for 19 of the top 35 emitters to land. For more information visit www.epa.gov.

Companies with the most numerous top ranking emissions sources:

• Nucor Corporation (11)
• DuPont Company (10)
• Southern Company (8)
• American Electric Power Company, Inc. (8)
• Renco Group Inc (7)
• Johnson Controls, Inc. (6)
• Phelps Dodge Corporation (6)
• Pfizer, Inc. (5)
• Waste Management, Inc. (5)
• Exxon Mobil Corporation (5)
• Hawaiian Electric Industries, Inc. (5)

Companies with the highest volume emissions sources (numbers represent a single plant or mine or other facility):

• Teck Cominco Limited (487.4 million pounds)
• Rio Tinto plc (224.8 million pounds)
• Newmont Mining Corporation (200.9 million pounds)
• Barrick Gold Corporation (102.8 million pounds)
• Pfizer, Inc. (43.2 million pounds)
• Nucor Corporation (89.1 million pounds)

TRI data can be found in Environment: Substantial Emissions. KLD analyzes TRI data and gives the concern to companies whose legal emissions of toxic chemicals from individual plants are among the highest of companies in the Russell 3000 universe of companies. These pollutants are released in mining spoils deposited on land, effluents discharged into rivers and coastal waters or injected into wells, and in airborne emissions issuing from stacks.

On average, companies with a KLD Substantial Emissions concern had approximately $129 in accrued environmental liabilities. Thirty-one of the companies did not report on accrued environmental liabilities in their annual report 10-K filings to the Securities and Exchange Commission. Companies qualifying for the substantial emissions concern had an average total of 2.4 KLD environmental concerns.

The update to the Substantial Emissions rating was implemented by KLD's senior environmental research analyst Andrew Brengle, with assistance from Andrew Moschetti, a graduate student at Babson College. Andrew Brengle is KLD's expert on the mining, oil, chemical, and utilities industries.