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Alarmed by a recent flurry of reports about unsafe products, New York City Comptroller William C. Thompson, Jr. is demanding that a major retailer take steps to minimize its customers’ exposure to toxic and hazardous imported products.

Comptroller Thompson, on behalf of the New York City Employees’ Retirement System (NYCERS), has filed a shareholder proposal demanding that Family Dollar Stores, Inc. of Charlotte, N.C., thoroughly investigate whether it is stocking its shelves with dangerous goods.

“Recent reports of toxic and hazardous products imported to the U.S. from overseas including toothpaste, toys, tires, pet food, and other products, have led to increased concern among consumers, regulators, and lawmakers about the safety of many products sold by U.S. retailers,” Thompson said. “I am urging Family Dollar Stores to take these concerns seriously, and to make sure that no one is placed in danger by purchasing an unsafe product. Consumers have a right to expect that what they spend their hard-earned dollars on will not harm them in any way.”

NYCERS specifically wants the Board of Directors at Family Dollar Stores to “publish a report evaluating Company policies and procedures for systematically minimizing customers’ exposure to toxic substances and hazardous components in its marketed products.”

“This report should summarize the criteria used to evaluate such products for safety, and include options for systematically identifying toxic ingredients and hazardous components in stocked products, and encouraging suppliers to reduce or eliminate such materials,” the proposal reads. Thompson wants the report to be completed by July 1, 2008.

Family Dollar Stores annually markets millions of dollars worth of imported products at its more than 6,300 stores in the United States. Over the last several years the company has had to recall a number of dangerous imported products, including children's bracelets containing high levels of lead, dangerously flammable Halloween costumes and Christmas tree ornaments, and faulty electronic extension cords and home appliances.

NYCERS holds 202,906 shares valued at $6,150,080 in Family Dollar Stores. The five New York City Pension Funds collectively hold 824,970 shares valued at $25,004,840 in Family Dollar Stores.

The other four New York City Pension Funds have filed a separate proposal with Family Dollar Stores asking the company to take steps to strengthen anti-discrimination measures. Both measures will be considered for a vote at the company’s annual meeting in January 2008.

“We believe that by publishing the requested evaluation of company policies and practices relating to products safety, the Company can help promote public trust, minimize legal liability, protect brand reputation, and safeguard and grow its market share,” the proposal reads. “We urge you to vote your shares FOR this resolution.”

Thompson said he expects to be raising the issue with other large nationwide retailers this Fall. The Pension Funds have been at the fore of shareholder activism in pressuring many of America’s largest companies to improve workplace conditions, protect the environment, promote human rights abroad, and adhere to accepted corporate governance standards.

Over the last few months – and even as recent as last week – warnings and recalls have been issued about pet food, toothpaste, toy trains, and types of fish that have been imported from a variety of countries.  Last week, for instance, Mattel announced a major recall of imported toys contaminated by lead paint.

The Pension Funds and Thompson did not identify any one country in the measure, explaining that his concerns are broader and about overall product safety.

“While discount stores provide significant cost savings for working families, the recent proliferation of unsafe imports demands increased vigilance. This is about safety, the food we put on our tables, the items we use on a daily basis to improve our lives,” Thompson said. “Retailers, as a first step, need to conduct these studies to be able to show to the public that what’s on their shelves is safe.”
 
In addition to Thompson, the other NYCERS trustees are: New York City Finance Commissioner Martha E. Stark (Chair); New York City Public Advocate Betsy Gotbaum; Borough Presidents Scott Stringer (Manhattan), Helen Marshall (Queens), Marty Markowitz (Brooklyn), Adolfo Carrion (Bronx), and James Molinaro (Staten Island); Lillian Roberts, Executive Director, District Council 37, AFSCME; Roger Toussaint, President Transport Workers Union Local 100; and, Gregory Floyd, President, International Brotherhood of Teamsters, Local 237.

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