[Virginia GASP]Philip Morris Shareholders' Meeting, 1999

A Report by Anne Morrow Donley,
Virginia GASP® co-founder

Below is a Table of Links, followed by a Table of Contents for this Report, followed by the Introduction to the meeting, questions, and presentations. Further text is available through the links.

TABLE OF LINKS:

Questions asked at the PM meeting by: Shareholder Proposals 1 - 4, opposed by Philip Morris Co., and defeated by Philip Morris shareholders:
    Submitted by The Congregation of the Sisters of Charity of the Incarnate Word, Texas.
   Submitted by The Province of St. Joseph of the Capuchin Order, Wisconsin.
   Submitted by The Christian Brothers Investment Services, Inc., New York.
   Submitted by The Sisters of Charity of the Incarnate Word Health Care System, Texas.

Web Links:

The Tobacco Product Liability Project web site at http://www.tobacco.neu.edu has a report on both the Philip Morris and the RJR shareholder meetings for 1999.

TABLE OF CONTENTS FOR THIS REPORT

Acknowledgments and Thanks

On behalf of health activists everywhere, we extend our sincere thanks to the Rev. Michael Crosby, of The Province of St. Joseph of the Capuchin Order, and ICCR, the Interfaith Center for Corporate Responsibility. Rev. Crosby has led by example for more than a decade, courageously coming to the Philip Morris meetings even when, in the beginning, his was the only voice raised to speak to the health and moral issues facing the company management and shareholders.

Our sincere thanks also for the moral and civic leadership and the health consciousness raising provided by the groups of shareholders who have worked so hard over the years to make these proposals.

In a free and democratic society, corporations must either voluntarily take responsibility for their actions, or be required to do so. Corporations should be held accountable for their actions.

 

Why Health Activists Participate in the Meeting

Why, you may ask, would activists go to such a meeting, where they know they are unwelcome, know they will be booed by some in the audience, know there will be the hazards of secondhand smoking (less each year except in the tent), and where they have such a short time for one and probably only one question?

In a free and democratic society, corporations must either voluntarily take responsibility for their actions, or be required to do so. Corporations should be held accountable for their actions.

The shareholders' meeting is an opportunity to actually meet management one on one, and possibly to influence events. This is an opportunity to raise the consciousness of the shareholders to make them ask themselves why their company is not taking responsibility for their actions. And sometimes, there are unlooked for gems in the answers: such as the year that Geoffrey Bible stated, twice, that he would advise pregnant women not to smoke. And in 1999, when he stated in answer to a question, that he would advise parents not to smoke around children.

For the most part, the shareholder audiences at Philip Morris are unwilling to hear any suggestions of how their company might improve, of  how their company might actually join the mainstream of businesses by manufacturing a product which does not addict and does not kill consumers and harm  bystanders when used as intended.

The Philip Morris employees and shareholders leap to their feat each year, booing and condemning the activists, apparently rationalizing that everything is OK, because to them it is obvious anyone can quit smoking, just because a small percentage do so every year.  And yes, there are people in the audience, often the shareholder speaking, who stopped smoking for health reasons, but, they tell the audience, that has nothing to do with anything. These people apparently want to be misled, and their speeches defy logic. They are the willing clay, as long as the checks come in, and Bible is their sculptor.

Year after year, the press randomly pick persons to interview coming out from the meeting, and each time these shareholders tell the TV cameras the same variations on one theme: "I don't care what the company does. The bottom line is my pocketbook."

Yet, also, year after year, the percentage points supporting the health resolutions grows greater. And at both Philip Morris and at RJR, there have been instances where the company has eventually followed the advice of the activists, without, of course, any acknowledgment of them.

At Philip Morris, there is so much control in place, that persons may not feel free to talk with the activists. But at the RJR meetings, in contrast, over the last three years, a growing number of men and women have come to us individually, and thanked us for coming, have said things like, "I know it must be very difficult. But, please, keep up the good work."

There are others who confess that they originally owned stock in the food divisions, and were sucked into the tobacco company ownership, and have not known what to do. There are some at the RJR meetings who privately confess they see their company as an immoral company.

But, outside of the activists, no one at the meetings publicly dares to suggest that the actions of Philip Morris and RJR are not only unhealthy but also immoral.

 

Philip Morris Sets the Stage

Entering the Philip Morris shareholders' meeting in late April is unlike entering any other meeting. It is an armed camp, a very ostentatiously wealthy and very obviously armed camp. Performance, perception, and control are the bywords.

Absolutely huge white tents (white is for purity?) are set up in late April in front of the main manufacturing plant in Richmond, Virginia, USA. Bright red flowers are placed in front of and throughout the tents (red and white for Marlboro?).

But before their bright festive colors lull you into an equally festive mood, do take note that guards with communicators are everywhere, at the main gate, throughout the parking lot, on the walkway to the tents and the building, and at all points inside the building.

And once you enter, before you even reach the registration tables, you must pass through security tighter than that at airports and courthouses and hostile foreign nations. You are not permitted to bring in any briefcase, any recording equipment, nor any cameras. This applies to the press as well.

Although Philip Morris makes a video recording of its meetings, these are not available to shareholders or the press.

Not for nothing is the Philip Morris motto: "We came, we saw, we conquered."

It is as conquering heroes that they display themselves, and you, the presumed conquered, are permitted to enter by pleasure of the emperor, and subject to his tight control.

Philip Morris does not have any memorials or displays of photographs of the millions of consumers who suffered and died from using tobacco products manufactured by Philip Morris, nor of those who died from breathing the secondhand smoke.

One of the many activist groups attending the meeting is INFACT, and their representatives have held such photographs in demonstrations between the busy street and the PM complex on the day of the meeting for the last three years.

A variety of other groups are represented by other dedicated health activists who attended the April meeting in Richmond, Virginia. In 1999, these health activists included the Rev. Michael H. Crosby, John Celichowski, Edward L. Sweda, Anne Morrow Donley, Dr. David O. Lewis, Francis Coleman, Alvina Bey Bennett, and Cheryl Wise.

Each year, the health activists are met at the registration desks by guides who smile tightly and stick closer than glue, escorting you through the elaborate "rooms" of the tents, past tables set for brunch, past pots of tobacco plants, past advertising displays, and past large "pat Philip Morris on the back for community benefactor" displays.

Playing divide and conquer, each year Philip Morris separates the activists, sometimes putting one or two in overflow tents or auditoriums. The smoke in the overflow tent is worse than in the main auditorium, and in 1999, one activist became seriously ill, had to leave, and later needed medical attention from the smoke. First she went outside, which upset her guide, and she asked the guide if there was a smoke-free area, and the guide said "No." But, later, as she left, the same attendant offered the information that there is (somewhere) a smoke-free auditorium. The woman was too ill at that point, and left the complex completely.

Inside the main auditorium, the guides take the remaining activists, who were unaware until the end of the meeting of the fate of their friend, to their seats, prearranged, marked with large "RESERVED" cards on the back of the seats, and with Philip Morris employees temporarily sitting in them to make certain these are "saved" for the activists. Once again, PM divides the activists, with some on one side of the auditorium, and the rest on the other side.
 
 

Contrast with Other Shareholder Meetings

The RJR shareholders' meeting, and other shareholders' meetings, by contrast, have no security system to pass through, and one may sit wherever one chooses. Although, at RJR, you are asked not to bring in recording devices, no one searches your person or X-rays your belongings as they do at Philip Morris.

At RJR, and at other meetings, the press are free to move about the room, and to interview people freely outside the auditorium, even during the meeting. But, at Philip Morris, the real working press (as opposed to tobacco press and tobacco analyst press) are gathered into one area, and may interview participants only after the meeting and only outside the building.
 
 

Overview of the Meeting

The show - and performance is the name of the game - begins with PM commercials from around the world shown on the huge screen at the front of the auditorium. In earlier years, under Hamish Maxwell, all the heads of the divisions sat at the front on the stage. But under Geoffrey Bible, he is the main actor, carrying the entire company upon his shoulders and with his boxing gloves figuratively in place. Only the secretary of the company, the financial officer, the large video screen, and an oversized vase of flowers are allowed to share the stage with Bible.

Bible has state of the art speech displays in front of him, so a flawless performance is possible. Planned or unplanned, as the meeting begins, he is given a standing ovation. The stage is now complete and set, the emperor is in control. Like a king, Bible raises his arms, acknowledging the applause, and the standing ovation. The meeting is broadcast to Philip Morris employees around the world.

The mood obviously is meant to be upbeat, a company on the move, not beaten down by lawsuits or legislation; a company defiantly ready to continue manufacturing an addictive drug that kills most of its consumers when they use it as the manufacturer intended, and maims and kills bystanders, including children, who breathe the smoke. This, apparently, is a company proud of its role as legalized drug pushers and murderers.

After telling the shareholders what they want to hear - that the company will continue to make money for them, and that lawsuits and proposed legislation will be handled without fear - the meeting moves to the next phase.
 
 

Question and Answer Period

A Question and Answer period of 20 minutes follows, in the last few years placed near the beginning of the meeting. On either side of each auditorium (main, auxiliary, tent), employees stand with portable mikes, feet carefully placed just beside the bright vinyl floor markers for the private video production. Cameramen from Philip Morris snap photos of each activist who asks a question, photos to fill the private corporate photo albums.

Each questioner has only two minutes for the question. In past years, follow-up questions were permitted, but no longer. There have been two obvious exceptions in the last two years, who have been permitted extra time and questions. First, a tobacco friendly well known analyst, Martin Feldman.  Second, the company friendly employees.

Are any of the questions "set up", a reasonable person might ask?
Appearances would reflect the answer, "Yes."
Employees asking about day care, environmental concerns of the company (not including Secondhand Smoke) and questions of the tobacco friendly analyst Martin Feldman, appeared "set up".  Certainly, the final effect is that these absorb much time in the asking and in the increasingly long answers from Bible. Which, of course, leaves less time for the questions from activists.

Questions were asked by:

Shareholder Proposals

Following the Question and Answer session, the shareholder proposals are presented. Having shareholder proposals accepted for consideration is not a simple nor an inexpensive process.
 
 

Shareholder Proposals - U.S. Securities and Exchange Commission

Shareholders with several shares may submit proposals to be considered at the meeting, but these must first be approved by the U.S. Securities and Exchange Commission. This is an expensive and complicated legal process consuming several months of time for the participants and their attorneys.

Four proposals were approved for the 1999 Philip Morris meeting. To be voted on at the meeting, these must also be presented by a representative at the actual shareholders' meeting, and be seconded.

Each proposal was opposed by Philip Morris, and defeated by the majority of the shareholders, but some proposals received enough votes to enable them to be reconsidered in 2000.

Philip Morris allowed only four minutes for the presenter, and only two minutes for the seconder. The text given in this web site may differ slightly from the actual delivery. Philip Morris does not permit any recording devices except their own, and very little light is available at the meeting for note taking.

<>The text of the proposals themselves and the Philip Morris statements against them may be received from Philip Morris by calling 1-800-367-5415 and requesting a copy of the most recent annual report and the 1999 shareholder proposals.

 
 

Concluding Remarks

Our thanks once again to the Rev. Michael Crosby, of The Province of St. Joseph of the Capuchin Order, and ICCR, the Interfaith Center for Corporate Responsibility. Rev. Crosby has led by example over many years, courageously coming to the Philip Morris meetings in the beginning when his was the only voice raised to speak to the health and moral issues facing the company management and shareholders.

Our thanks once again for the moral leadership and the consciousness raising provided by the groups of shareholders who have worked so hard over the years to make these proposals.

Our thanks also to all the activists who attended the 1999 meeting, and especially to the Rev. Michael H. Crosby, John Celichowski, Edward L. Sweda, Anne Morrow Donley, Dr. David O. Lewis, Francis Coleman, Alvina Bey Bennett, and Cheryl Wise.

In a free and democratic society, corporations must be held accountable for their actions.


[Virginia GASP]Updated 24  July 1999