Shareholder Resolution Demands Better Transparency of Rockwool

Danish corporation Rockwool International is tackling “today’s biggest sustainability and development challenges” by producing highly energy efficient, recyclable and fire resistant insulation products, according to its website and promotional materials.

But shareholders Tim Ross and Rod Snyder think there’s room for improvement. The two West Virginians will travel to Denmark next month to present an environmentally-minded resolution to Rockwool’s annual general shareholders meeting.

Their proposal addresses how Rockwool can manage risk more effectively, and for Ross and Snyder, the risk is personal. They live in Jefferson County, W.Va., where Rockwool North America plans to build a stone wool insulation fiber factory near their homes.

Rockwool promotes the “sustainability” and energy efficiency of its product in a mailing to residents near the Ranson site.

The shareholder resolution calls for Rockwool to prepare an assessment “above and beyond existing existing disclosures and those required by law” of the impacts of the siting of its manufacturing facilities and of the usage and discharge of water in manufacturing.

“I submitted the proposal because I think Rockwool can become a better company by accepting the resolution, and I think that all shareholders should be better informed,” Ross said.

Rockwool has met fierce opposition in Jefferson County because of the siting of the Ranson factory across the street from an elementary school and near three other public schools as well as residential neighborhoods, daycare centers and a VA hospital.

The predicament lies in the company’s emphasis on it’s “green” product versus the “dirty” manufacturing process, which uses coal and natural gas to fire the furnace and emits 156 tons of air pollutants per year.

Rockwool’s disclosures “significantly focus on the inherent environmental value of Rockwool’s products while lacking sufficient transparency and completeness” with respect to risks, the shareholder resolution says.

Rockwool International’s stock value has fallen 33% in the last 6 months.

Rockwool International’s board of directors opposes the shareholder resolution, saying it “believes that the company adequately discloses relevant risks and material impacts” via existing reports, and furthermore, the company “naturally” respects regulations when it locates new manufacturing facilities. It denies that there are “production process waste water discharges into waterways or the ground at any of the company’s manufacturing facilities.”

Municipal governments and local community members are dissatisfied with Rockwool’s changing estimates of water usage and wasterwater discharge. The geography is of the area is described as “karst,” which is semi-permeable limestone. The Rockwool site is located in an area of a significant number of sinkholes. Rockwool opponents fear accidents and spills which could lead to contamination of groundwater.

“While I am disappointed in the Director’s decision to not support the resolution, I think that other shareholders, especially those that are environmentally aware should see the resolution in a favorable light,” said Ross.