Asbestos and James Hardie:
The background
Asbestos diseases in Australia
Inhalation of asbestos fibres has long been known to cause debilitating respiratory diseases known as asbestosis and asbestos related pleural disease. It is also linked to lung cancer and mesothelioma, a cancer that commonly attacks the lining of the lung and is usually fatal within nine to twelve months of diagnosis. On average, for those that develop mesothelioma, it can take about 37 from first exposure to asbestos before the onset of the cancer.
With the world’s highest per-capita rate of mesothelioma, it is estimated that by June 2003 over 7,500 Australians had contracted mesothelioma, which is expected rise to 18,000 by 2020. For every incident of mesothelioma an additional two cases of asbestos-related lung cancers are estimated to occur, adding an additional 30,000 to 40,000 additional cases of Australians developing an asbestos-related cancer by 2020.
James Hardie
James Hardie was Australia’s largest manufacturer and distributor of asbestos containing products, which included insulation products, asbestos cement sheets (known as fibro in Australia), pipes and friction materials, such as brake and clutch linings. Despite being aware of dangers of asbestos since the 1930s, James Hardie first placed a warning on its asbestos products as late as 1978, ceasing production in 1982.
James Hardie’s asbestos products were mostly produced by two subsidiary companies that it directly controlled. After stripping the profits from its asbestos producing subsidiaries, James Hardie, in February 2001, set up the Medical Research and Compensation Foundation (MRCF). James Hardie established the fund to separate and take over the compensation of its victims, providing A$293 million to meet its transferred asbestos liabilities.
Eight months later, in October 2001, James Hardie established a Netherlands-based parent company and took A$1.9 billion ($1.3 billion) from Australia to the Netherlands, a country that does not have a treaty for the enforcement of a legal decision taken in Australia.
In March 2003, without reference to the relevant Australian authorities, James Hardie in Australia was separated from the international group, indemnifying the Netherlands parent company and severing the lifeline for Australian creditors, including asbestos claimants.
Earlier this year, in response to union pressure, the New South Wales (NSW) Government opened a judicial inquiry into the establishment of the compensation fund, where it has emerged that James Hardie significantly under-funded the MRCF by up to A$2 billion ($1.4 billion). The inquiry is expected to provide its report to the NSW Government on September 21, 2004.
As recently as July 2004, James Hardie has suggested the establishment of a statutory scheme for the future provision of compensation to its asbestos victims. This scheme has been universally rejected by unions and asbestos support groups in Australia in the belief that it will result in a one-size-fits-all, capped compensation payout, a reduction of victims legal rights and the transfer some of the company’s asbestos debt onto Australian taxpayers.
Australian unions’ campaign
Outraged by the James Hardie attempt to avoid its responsibilities to pay compensation to its victims, trade unions and asbestos suffers’ support groups in Australia have launched a range of campaign actions aimed at preventing the company from escaping its moral and legal obligations. Actions include:
- Boycotts of James Hardie products, including the decision by the Sydney City Council to refuse the use of James Hardie products in all future contracts until victims are properly provided for;
- Industrial bans on using James Hardie products;
- Petitions calling on the Australian Government to establish a treaty with the Netherlands;
- Planned protests rallies at James Hardie’s shareholder meetings in Australia and the Netherlands;
- Letters to James Hardie shareholders appealing directly for their support; and
- Attendance at shareholder meetings with proxy votes.
Internationally, the campaign is supported by unions and asbestos suffers’ support groups in the Netherlands and the UK. The International Metalworkers’ Federation has also supported the campaign calling on its affiliates to support the action against James Hardie taking place in Australia and the Netherlands.Sep 14, 2004 – Anita Gardner