Toxic assets may have sickened the economy, but now some major investors say real-world toxic chemicals could hamper an already painfully slow recovery. Jonas Kron is a vice president with Trillium Asset Management
, one of dozens of organizations managing a combined total of over $35 billion that sent a letter
to key lawmakers this week calling for new laws to replace what they call an 'outdated toxic chemicals regulation regime.'
"Not only for the health and well-being of people, but also the return and value of our portfolios."
While conventional wisdom contends that more regulation is bad for the bottom line, Kron says inadequate or out-moded safeguards are worse for markets. Examples he gives include toxic pollutants causing decreased productivity from more workers taking sick days, higher health care costs, and a ripple effect on taxes as when school districts' special education needs increase.
Kron cites coal-fired power plant development as a 'classic example' when pollution taints nearby air and water, rather than investing in reduced emissions at those plants.
"So, the costs are basically being shifted to the health insurance companies, for example, and for all the companies who employ workers that are on the downstream of that pollution. So, you're just moving costs around from company to company in that case."
Kron says if anything, the last few years have shown that markets aren't perfect.
"And there is a role for government to play in correcting for those market deficiencies and those market failures and this is one of those places."
The investor letter, signed by 51 organizations, endorses S. 3209
, the Safe Chemicals Act of 2010, and H.R. 5820
, the Toxic Chemicals Safety Act of 2010. Both proposed laws would comprehensively overhaul the Toxic Substances Control Act of 1976 (TSCA).
More information at at www.www.asbcouncil.org