Byrd, Rockefeller seek to force coal industry to disclose more safety information to shareholders

May 7, 2010 by Ken Ward Jr.

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Sen. Robert C. Byrd, D-W.Va., wants to hold coal companies accountable for not reporting certain key health-and-safety information to their shareholders.

Byrd introduced an amendment yesterday to the huge Wall Street accountability bill (the Restoring American Financial Stability Act) as his first legislative response to the deaths  of 29 miners in an April 5 explosion at Massey Energy’s Upper Big Branch Mine in Raleigh County, W.Va.

In a statement this morning, Sen. Byrd said:

Investors ought to know if a company is jeopardizing its workforce in order to maximize its profits.  In addition, failure to disclose these adverse safety or health conditions could have a significant financial impact on investors, especially if there is a halt in operations because a company failed in its obligation to protect its workers.

As we seek to make Wall Street more transparent and accountable to investors and Main Street America, I believe it is imperative that workers, investors and the general public receive a more complete and consistent analysis of whether the companies in which they have invested their funds are operating in a safe and healthy manner. Many companies maintain commendable health and safety records, and also disclose those records.  Unfortunately, not all companies maintain such good records.  Inconsistent disclosure in the past has made it hard to separate the wheat from the chaff.

Joining Sen. Byrd to co-sponsor the amendment was Sen. Jay Rockefeller, D-W.Va., who said today:

By disclosing important mine safety information to shareholders, it’s a win for companies doing a good job, and a much-needed alert for companies who are not. Currently, there is no requirement to publicly disclose safety records, which has allowed companies to operate without critical checks and balances. West Virginia suffered a terrible loss recently at the Upper Big Branch mine and we owe it to our miners and their families to do more to make mine safety a top priority.

You can read the text of the Byrd amendment by clicking here, and then scrolling down until you see amendment No. 3880.

A summary released by the senator’s office described the amendment this way:

Specifically, Sen. Byrd’s amendment required publicly traded corporations to disclose information about occupational health and safety conditions at risky workplaces — such as coal mines or oil rigs.  The Securities and Exchange Commission and shareholders would be authorized to seek equitable relief (such as the immediate disclosure of health and safety conditions), as well as civil penalties in cases of knowing failure to disclose information.  The scope of the relief and the penalties would be set by a court, in proportion to other penalties that may be imposed under health and safety laws, and in light of the facts and the circumstances of each case.

The amendment requires corporations to disclose four categories of health and safety information:  pending litigation regarding health and safety; significant health or safety conditions at risky workplaces, which may cause the corporation to incur damages arising from wrongful deaths; significant health or safety conditions that may impact financial conditions or operating results within the corporation; and trends in health and safety violations that may affect the relationship between costs and revenues of a corporation.

Sen. Rockefeller also has filed his own amendment, (click here and search for amendment 3886), which his office summarized this way:

Senator Rockefeller’s amendment is needed to provide shareholders and investors with clear, up-to-date numerical data on a company’s mine safety record. This amendment would require any publicly-traded mine company to report the following information in their annual and quarterly filings with the SEC:

(1) The total number of significant and substantial violations of mandatory health or safety standards;

(2) The total number of failure to abate orders issued under section 104(b) of the Mine Act;

(3) The total number of citations and orders for unwarrantable failure of the mine operator to comply with mandatory health or safety standards under section 104(d) of the Mine Act;

(4) The total number of flagrant violations under section 110 of the Mine Act;

(5) The total number of imminent danger orders issued under section 107(a) of the Mine Act;

(6) The total dollar value of Mine Safety and Health Administration (MSHA) proposed penalties and fines;

(7) A list of the regulated worksites that have been notified by MSHA of a Pattern of Violation or a Potential to have a Pattern of Violations under section 104(e) of the Mine Act; and

(8) Pending legal action before the Federal Mine Safety and Health Review Commission.

In addition, any publicly-traded mining company must issue an immediate disclosure report to the SEC if it:

(1) Receives a shutdown order under section 107(a) of the Mine Act (imminent danger), or

(2) Receives notice that a mine site has a potential or actual pattern of violations.


7 Responses to “Byrd, Rockefeller seek to force coal industry to disclose more safety information to shareholders”

  1. Thomas Rodd says:

    This sounds like the kind of information that investors and shareholders have a right to know. And, when such information is disclosed, then shareholders and investors who profit from a companies’ dangerous activities are deprived of the possible “excuse” — “we just did not know what was going on.”

    Are there similar duties with respect to disclosing compliance with laws designed to protect the public health and the environment?

  2. clay ton says:

    re: Senators Byrd, Rockefeller seek to force industry to disclose more safety information..

    In matters of public and workplace safety, the lag time between acknowledging problems and their remediation needs to be reduced.

    Thank you Senators Byrd and Rockefeller for demanding accountability and transparency from the publicly traded corporate sector. Surely those who blindly support corporate interests will hoot and holler and put up a great fight against any measure that might protect the living. I ask the obstructionists to reflect on the lives of their future generations; we all share the same air and water, take to heart the words from the book of Genesis 4:9 “Am I my brother’s keeper?” Those of you who claim to cherish life cannot exclude the degradation of life on this planet and the quality of life of industrial workers who bring us modern conveniences nor those who must inhale poisonous air in our nations cities.

    Given our ability to mange and distribute information here in the 21st century all public entities and government agencies should make ‘key health-and-safety information’ readily and easily available on the Internet. For the health of the nation privately held companies should also be required to publicly post information that has public impact. Hopefully, if such information is available in the future good people will use such data to alert the largely oblivious and disinterested public. The vitality of the nation is at stake.

    For instance, “Mine Safety and Health Administration did not act on proposed recommendations on how to combat floating coal dust..”
    http://www.post-gazette.com/pg/10115/1053228-84.stm
    How many miners are aware that the “National Institute for Occupational Safety and Health wrote in a 2009 report. The research forming the basis of the current rock dust-coal dust regulations was conducted in the 1920s. NIOSH now recommends that instead of 65 percent rock dust, the concentration should be more like 80 percent. The research has been cultivated for decades, said Jeffrey Kohler, who directs the agency’s Office of Mine Safety and Health Research…though it was not certified and peer-reviewed until recent years. Even then, MSHA did not act to update its regulations to reflect those findings.”

    What’s the sense of doing the research if there is no implementation?

    Contact me: coallawreview@yahoo.com

  3. Ken Ward Jr. says:

    clay ton,

    You sure like to cite those Post-Gazette stories … but you may have missed that the Gazette had the story on float coal dust two weeks before the Pittsburgh paper:

    http://wvgazette.com/News/montcoal/201004130791

    Ken.

  4. clay ton says:

    Ken, re: http://wvgazette.com/News/montcoal/201004130791

    Thanks for the reference to National Institute for Occupational Safety and Health 2009 report on the problem of ‘finer’ coal dust; I stumbled across the NIOSH press release a few weeks ago. An interesting part of the 4/13/10 WV Gazette piece is the image of the miner spreading lime by hand…very 18th century!! This is yet another example of those mining coal using not using modern techniques. Quaint, but not where we need to be. Thank you.

  5. Vnxq809 says:

    Clay ton,

    Spreading rockdust by hand after a freshly mined cut of coal is not an example of a company not using modern techniques – it is very common and very effective. It is very typical to use this technique after a cut is bolted and cleaned and then it is typically saturated w/ a blower duster or trickle duster later.

    Vnxq809

  6. rhmooney3 says:

    I’ve waited and waited to see what would be said about proposed “great” public disclosure.

    Let me said this:

    Massey Energy stock was at a 52-week high on April 5, when the Upper Big Mine deaths occurred. It’s record of safety, of controversies and everything else was more than well publicly disclosed.

    Same goes for Murray Energy.

    Such public disclosures didn’t seem to bother their stockholders.

    So why would this proposed action have any results.

    IF the senators were serious, the disclosures would be done online — in real time — for all violations and penalties incurred by an corporation. The federal government could do this without difficulty. (Corporation registries by states are already online.)

    This way all corporations would be treated equally.

  7. […] Rockefeller’s letter aside, the only real action so far in Congress has been efforts by he and Sen. Robert C. Byrd to add some shareholder accountability for coal […]

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