Document OznG0mGNvd0e3x8em0NKbd3xL

AGENDA MEETING CF THE CMA HOARD OF DIRECTORS Monday and Tuesday, January 11 and 12, 1S62 Grand Ballroom, Arizona Siltmore Phoenix, Arizona Monday, January 11, Z9B2 - 8:00 a.ia. g:00-3:01 1. Call to Order -- Chairman Craffice 5:01-10:00 10:00-10;35 10:35-11:10 11:10-11:45 COMMITTEE CHAIRMEN REPORTS 2, Communications Committee Chairman; M. C. Carpenter, The Dow Chemical Company 3. Chemical Regulations Advisory Committee Chairman: E. Hamilton Hurst, Nalco Chemical Company 4. Patent and Trademark Committee Chairman: Richard G. Waterman, Dow Chemical D.S.A. 5. Occupational Safety and Health Committee Chairman: Thomas F. Evans, Monsanto Company 11:45-11:55 ASSOCIATION ACTIVITIES 6. Member Services Report -- Victor H. Peterson LUNCH {North Patio) ' TAB This 3oard meeting will continue Tuesday, January 12, 1982, beginning at 9:00 a.m. in the Grand Ballroom. Next meeting of the Board of Directors: 2:00 p.m., Tuesday, April 6, 1952, CMA Board Conference Room, Washington, D. C. CMA 073515 AGENDA - Meeting of the CMA Board of Directors (continued) Tuesday, January 12, 1982 -- 9:00 a.a. CONTINUATION Cr COMMITTEE CHAIRMEN REPORTS 9:00 a.m. 9:00-9:35 9:35-10:10 Call to Order -- Chairman Oreffice 7. International Trade Committee Chairman: F. Milton Hunt, The Dow Chemical Company 8. Tax Policy Committee Chairman: James L- Eichner, Eastman Kodak Company BUSINESS SESSION 10:10-10:11 9. Approval of Minutes of Meeting, November 3, 1981 -- Chairman Oreffice 10:11-10:15 10. Report of Executive Committee -- Chairman Simeral 10:15-10-17 11. Treasurer's Report -- Gary C. Herrman 10:17-10:27 12. International Trade Policy -- Leo H. Johnstone, Phillips Petroleum Company 13. Association Activities: 10:27-10:45 a. Report of the President -- Robert A. Roland 10:45-11:00 b. Results of RfiD Survey of Member Companies -- Myron T. Foveaux 11:00-11:10 c. Report of Technical Director -- G. V. Cox 11:10-11:20 d. Report of General counsel -- E. B. Frost 11:20-11:30 e. Report of Director of Government Relations -- W. M. Stover 11:30-11:45 14. New Business 11:45 15. Adjournment TAB 2 3 4 5 6 7 CMA 073516 2174 MINUTES of the two-hundred eighty-sixth meeting of the Board of Directors of the Chemical Manufacturers Association, Inc., held at the Arizona Biltmore, Phoenix, Arizona, on Monday at 3:00 a.m. and Tuesday at 9:00 a.m., January li and 12, 1982. ' Directors Paul F. Oreffice, Chairman Louis Fernandez, Vice Chairman Richard C. Ashley Wilbert J. Magers Dexter F. Baker Dwight C. Minton Charles E. Brookes John Morrisroe Harry W. Buchanan L. John Polite, Jr- Carlyle G. Caldwell Robert A. Roland Robert 5. Dudley John P. Sachs Richard E. Engebrecht M. Whitson Sadler Robert W. Gerwig James F. Schorr Arthur L. Goeschel George J. Sella J. B. Henderson William G. Simeral Paul F. Hoffman (2} Orin R. Smith E. C. Holmer . Alfred C. Stepan, Jr. Richard J. Hughes Allan J- Tomlinson (1) .Ray R. Irani Hugh B. Vanderbilt William B, Jackson Edward A. Von Doersten Richard H. Leet ' William G. West John S. Ludington Secretary; General Counsel: Treasurer: By Inviation: . - Bruce M. Barackman Edmund B. Frost " Gary C. Herrman M. C. Carpenter, The Dow Chemical.Company (1) . Geraldine V. Cox, CMA John E. Dull, E. I. du Pont de Nemours s Company James L. Eichner, Eastman Kodak Company (2) Thomas F. Evans, Monsanto Company ,fl) Myron T, Foveaux, CMA (2) Milton Freifeld, CMA (1) Robert a. Hill, CMA F. Milton Hunt, The Dow Chemical Company E. Hamilton Hurst, Nalco Chemical Company Patrick C. Joyce, CMA 11) Victor H. Peterson, CMA (1) Ernest S. Robson, Jr., SOCMA, Monsanto Company William Sbarfman, Brouillard Communications Division of J. Walter Thompson (1) Randal P. Schumacher, CMA James N. Sites, CMA William M. Stover, CMA Gordon D. Strickland, CMA Richard G. Waterman, The Dow Chemical Company (1) Richard L. Wilson, CMA (1) (1) first day only {2) second day only Monday, January 11, 1962 2175 1. The meaning was called to order by Chairman Oreffice. COMMITTEE REPORTS Executive summaries are attached in lieu of the complete committee reports which have been previously distributed to the Board. 2. COMMUNICATIONS COMMITTEE The executive summary of the committee report is attached as Exhibit A. Chairman Carpenter reviewed the objectives, audiences, and program elements of ChemCAP, Exhibit B. Mr. Roland described the results of the program, including illuminating statistics relating to the size of audiences reached in each activity of ChemCAP, Exhibit C. Following Mr. Carpenter's presentation of the recommendations of the Communi cations Committee, Exhibit 0, Dr. Sharfman, senior vice president and planning director of Brouillard Communications, a division Of J. Walter Thompson, ex plained the specifics of the proposed T.V. test. At the conclusion of a question and answer period during which various con cerns were expressed, the matter of the T.V. ad test was referred to the Executive Committee to prepare a recommendation for consideration by the Board. 3. CHEMICAL REGULATIONS ADVISOR? COMMITTEE : The committee report, supplemented with chairman Hurst's report, is attached as Exhibit E. , Ji 4. PATENT AMD TRADEMARK COMMITTEE *- The committee report, supplemented with chairman Waterman's report, is attached as Exhibit F 5. OCCUPATIONAL SAFETY AND HEALTH COMMITTEE The committee report, supplemented with chairman Evans' report, is attached as Exhibit G. ' 6. MEMBER SERVICES REPORT Mr. Peterson's report is attached as Exhibit H. Additionally he described a preliminary analysis conducted of some 114 non-member chemical companies having annual sales ranging from $30 million to over $100 million -- all of which could contribute meaningful financial support if they were members of CMA. After further study it is planned to make a presentation to the Membership Committee for their consideration and recommendation to the Board as appropriate. ** * # * CMA 073518 The Board adjourned until 9:00 a.m., Tuesday, January 12. 2176 Tuesday, January 12, 1982 7. INTERNATIONAL TRADE COMMITTEE The committee report, supplemented with chairman Hunt's report, is attached as Exhibit I. 8. TAX POLICY COMMITTEE The committee report, supplemented with chairman Eichner's report, is attached as Exhibit J. The committee reports having been concluded the Board then proceeded with its scheduled business session. ~ 9. MINUTES OF THE NOVEMBER 3, 1981 MEETING The minutes of the November 3, 1981 meeting of the Board, as distributed, were approved. 10. REPORT OF EXECUTIVE COMMITTEE Mr. Simeral reported the following actions taken by the Executive Committee the preceding day: - Approved a change in the name of the "Pension Committee*' to "Employee Benefits Committee*'. Also approved the committee's recommendations pro viding for: establishment of an educational assistance program which would reimburse CMA full-time employees for 75% of the cost of successfully com pleted, job related, continuing education activities at an estimated annual cost of $8,000; establishment of a thrift savings plan permitting an employee to contribute up to 10% of salary of which CMA will match 50% of the first 6% at an estimated annual cost of $56,000; and amendment of the CMA Pension Trust to clarify the language of the disability provisions in the current plan. Approved chemical industry participation in tJ.s. government petrochemical discussions with Japan and Mexico. Approved several recommendations of the Occupational Safety and Health Com mittee which included the establishment of a new Lammot du Pont Safety Award category for intermediate size companies. There will now be three award categories. Category 1 -- less than 1,000 employees; Category 2 -- 1,000 to 10,000 employees; and Category 3 -- over 10,000 employees. Heard a report that the staff training program is going forward as planned. Heard a suggestion from Mr. Oreffice that the opportunity exists for member companies to work constructively with EPA regional officers on environmental matters. CMA staff will explore what the Association may do by working with state organizations such as the CIC's. . CMA 073519 2177 Discussed in depth CMA's advertising program and unanimously voted to recommend to the Board that consideration of the proposed T.V. ad test program be deferred until the August meeting. During discussion of the foregoing recommendation the Board was advised that in preparing the 1982-83 budget to be submitted for approval of the Board in April, staff has been instructed to be guided by Option #1 in the Treasurer's Analysis of Combined Communications Program Funding and Expenditures -- deleting the T.V. ad test, but preserving the funds for same. ON MOTION, duly made and seconded, it was VOTED: To approve the recommendation of the Executive Committee that consideration of the proposed T.V. ad test program be deferred until the August meeting of the Board. 11. TREASURER'S REPORT Mr. Herman's report is attached as Exhibit K. Additionally he advised: For the current year CMA should end up with a net contribution to reserves of several hundred thousand dollars. Dues will be lower but this should be offset by interest income and the fact that research and consulting ex penses should be significantly less than budget. Full projections will be available at the March .Finance and Executive Committee meetings and will be distributed to the Board in April following preliminary review. The communication assessment was billed in early December, 1981. Through January 6, 1982, a total of $1,556,336 has been paid by 88 members. Pay ments are not due until January 31. At this point the payment rate is running ahead of prior years. ~ . The budget process for fiscal 1982-83 is well under way. The requests for 1981 chemical sales have been mailed with a cut-off date of February 1 for returns. Assistance of member companies in expediting the return of reports was requested since they form the basis for revenue projections. 12. REPORT OF MEMBERSHIP COMMITTEE Chairman Caldwell reported that the committee had examined the qualifications of the companies named below and recommended their election. ON MOTION, duly made and seconded, it was VOTED: That Petrosar Limited and Philip A. Hunt Chemical Corporation be elected to membership in the Association. 13. INTERNATIONAL TRADE POLICY Mr. Foveaux, on behalf of Mr. Johnstone, briefly reviewed the Common Market talks concerning petrochemicals in which Mr. Johnstone participated. As a result CMA 073520 2173 of these talks the threat to levy protective tariffs against petrochemical exports to Europe from the United States was eliminated. Mr. Foveaux then presented the recommendations, Exhibit L, previously approved by the Executive Committee, relating to chemical industry participation in CJ.S. government petrochemical discussions with Japan and Mexico. He advised that Canada also Is expected to seek similar discussions. He then reported that the House ways and Means Trade Subcommittee under Chairman Sam Gibbons (D-Fla.) held trade policy overview hearings late in the first session of Congress. He advised that Mr. Johnstone was scheduled to appear on behalf of the chemical industry on December IS, 1981. However, his appearance was postponed because Congress went home that week. The hearings and Mr. Johnstone's appearance will be rescheduled early in the second session, probably in February, perhaps in March. The significant points to be made in his testimony were summarized. 14. ASSOCIATION ACTIVITIES (a) Report of the President ' Mr. Roland described the reports of the committee chairmen as the - best ever and truly reflective of the continuing growth and efficacy of the committee structure at CMA. The reports also show that the burden of work is expanding. Accordingly more emphasis will have to ' be placed, especially in the light of present economic conditions, on prioritization -- a better utilization of resources is the focus of committees and staff in the ongoing planning process to manage the workload. The political bloom is off the rose and it will become increasingly difficult to resolve the government relations problems that face the industry. Just one significant policy issue is how do we forge an industry position on the new federalism versus States rights. In . addressing this and the many other issues confronting us, we have the machinery in place to do the kind of imaginative thinking that is called for at this stage in our development. (bt Results of R&D Survey of Member Companies Mr. Foveaux*s report is attached as Exhibit M. He also referred to the economic press conference held by CMA in New> York City on December 16, 1981, which is further discussed in Mr. Stover's report. (c) Report of Technical Director Dr. Cox's report is attached as Exhibit N. (d) Report of General Counsel Mr. Frost's report is attached as Exhibit 0. In addition he presented CMA 073521 - HO"- .. 2179 an update and overview of the Administration's regulatory reform activity. He also commented on CMA'5 Supplemental Response to the , President's Task Force on Regulatory Relief, copies of which were distributed to those present. (e) Report of Director of Government Relations Mr. Stover's report is attached as Exhibit P. He referred in particular to the Clean Air Act amendment process and urged member companies to respond to the action call going out this week from CMA explaining what actions individual companies can take to obtain improvements in the act. IS. NEW BUSINESS Mr. Robson advised that SOCMA considers the New Federalism to be one of the key issues facing the industry this year. A SOCMA study is being conducted which will result in some industry policy guidelines which will be shared with CMA. Bruce M. Barackman Vice President-Secretary CMA 073522 COMMUNICATIONS COMMITTEE REPORT EXECUTIVE SUMMARY EXHIBIT A The chemical industry's communications action program has hit stride during the 1931-1982 year, fulfilling the promise en visioned by the special Public Relations Task Force appointed by the CMA Board of Directors in early 1979 to come up with a plan of action to meet the industry's worsening public atti tude problems. This multifaceted program, carried out by the CMA Communications staff with the overall guidance of the in dustry's Ccmmunications Committee, was marked by these devel opments as 1982 began: "The Chemical Balance: Benefitting People, Minimizing Risks,11 has been completed as the comprehensive sixth booklet in the CMA's key issue series documenting the industry's case. It comes on top of 100,000 copies of the other five booklets already printed. "Pollution Control and Waste Management: Where Do We Stand?u is appearing in the first-of-1982 issue of Time Magazine as a special four-page advertisement documenting the industry's case for Time's 20 million readers. This special report caps off two generations of ads that in 20 months have made over a billion impressions on readers and the public consciousness. . - ._ Camera crews are shooting industry scenes for a new haz ardous waste motion picture and series of television news clips and public service announcements, with a completion, target date set for March 1982. The new film will supolement "Doing Something," which has-gone through more . " than 8,000 showings before schools, organizations and in dustry groups and been viewed by 8,000,0(J;Q on TV. The CMA News Service, after handling a record 4,000 press inquiries in 1981,"produced a special package of new-year story materials, held an economic briefing in New York City and inaugurated "The Report"--a chemical industry radio news service for 625 stations covering the nation. ChemEcologv, reaching 100,000 thought leaders monthly, ... sought to extend its reach to millions through a new ChemEcolcgy Science News Service'for 1000 science editors. This emphasizes the"CMA magazine's special policy issue reports and its new "Chemical Connection" series on indus try contributions and benefits, ' "Chemical Worker Safety," the fifth in CMA's series of envelope-size key issue leaflets, is being mailed to the industry and thousands of consumer contacts and organiza tion leaders. ` ; 3 sswp m CMA 073523 2 CHA Maws has published a year-end Review and Outlook is sue for the crass and other thought leaders, capping off a series of special reports on public policy issues pro viding direct support for governmental action during the year. The CMA communications staff is responding to steadily rising requests for public support aid from the industry's government relations forces and other CMA departments and industrywide committees. The central objective behind this varied, wide-ranging action: Public reassurance. The Communications Committee seeks to in tegrate CMA programming with that of individual member compan ies in pursuit of these objectives: 1_. To increase public recognition of the industry's efforts ' to meet health, safety and environmental challenges and to manage the risks associatad with chemical industry products and operations. 2. To develop public support for the industry's governmental policy positions. . ' 3. To better inform the nation of the industry's positive contributions. Toward this end, CMA's modest information program was supple mented two years ago, through CMA Board action, by the Chemi cal Industry's Communications Action Program--and both are now fully integrated into a consolidated effort. A competent staff has been assembled and, for the first tine in its history, the industry has a full package of communications materials avail able to tell the industry's story and build public support for its objectives. * The Communications Committee, composed of 15 public relations specialists from CMA member companies and another 68 experts on the Committee1 s six Task Groups, was appointed simultan eously and charged with the specific mission of advising the CMA Board and CMA communications staff on problems and atti tudes involving the industry's relations with the public and providing guidance and assistance on the development and im plementation of remedial programs in this area. In carrying out its mandate, the Committee has developed an intensive program planning process that began last September with an in-depth review by its Long-Range Planning Task Group. The Committee recommendations in summary: The CMA communica tions program is on course, is achieving results and should be continued as an interlocked, multifaceted package; however, a number of "course corrections" should be made to shift over all emphasis in present programming somewhat from print adver tising to more news and issue support action. At the same CNtf^3524 3 time, the Committee recommends that testing be carried out to determine the feasibility of extending the industry's print advertising campaign into network television. The proposed TV test would be carried out in two stages: 1. Developing the most effective message vehicle for com municating the industry's case on television. 2. Undertaking a pilot field test of television advertis ing in four selected communities at two different ex penditure levels to ascertain whether and at what cost the industry should carry out a national television information effort. The ad test timetable would postpone any actual broadcasting and.its funding until September of 1983, according to present planning, and the Committee would keep the Board fully informed of test progress and results so that the Board would have the fullest possible evidence before it for any discussion of fol low-through action. Cost of the TV ad test isjmdgeted at 8455,000. The present backlog of unspent ChemCAP funds would be tapped for this amount, and their expenditure would be spread over the present and next budget years. The public attitude climate facing the industry seems to be improving, despite polls that show continued heavy public sup port for government regulation in health and safety areas. CMA's third-stage survey of attitudes should provide a better fix on these questions by April. And while some of the improve ment is due to the let-up of the drumbeat of negative publicity originating from EPA and other government sources in 1980, pollsters ascribe a share of it to the industry's communica tions efforts. The television ad test would give the CMA Board additional facts to determine if our overall efforts to build a favorable public attitude climate for the industry need to be expanded into television advertising. Member company communications efforts seem to be lagging, fur ther highlighting this question, the CMA program was intended . to serve as an "umbrella" nationwide effort that would provide materials and serve as a catalyst for individual company action, especially at the community level and with company contacts. Toward this end, the Committee and CMA staff, with Board sup port, have devoted the strongest efforts. Unfortunately, and especially as a result of economic recession, many companies seem to be reducing rather than expanding their i communications efforts. The Committee believes this underscores even more the need to maintain a strong CMA role in fighting the industry's overall public communications battles. CMA 073525 - v-- un summary, uhe Comittee faels rha ir.cust-v cs.~ ~ arabla grids in developing an effective commie at gram, which is getting results. Quality* is sreser. is a continuing problem, The key question for 3ca ation involving Tv ac tasting: Should the industry position itself now so that it night later be ready, if public opinion and governmental ceveiocments demand it, to take another step forward in the in- " dustry's public sunport efforts? CMA BD-I/U/82 CMA 073526 EXHI3IT COMMUNICATIONS COMMITTEE REPORT TO CMA BOARD OF DIRECTORS January 11, 1982 PROGRAM STATUS Two years ago CMA had a modest public information program that was basically a defensive operation. The 3oard of Directors then approved a plan to aggressively put our position before a number of audiences -- the Chemical Industry's Communications Action Program, or ChemCAP. . Both the ongoing CMA communications activities and ChemCAP are now fully integrated. . The central goal of the integrated program is: Public reassurance. - The main objectives are: Increased recognition by the public of industry efforts to: Meet health and safety and environment challenges. Manage risks associated with chemical industry products and operations. Build public support-for the industry's governmental policy positions. Our programs to date have been aimed at the following audiences: Political actives Government officials Communicators Company employees Through CMA, member companies, some shareholders, suppliers and customers are reached as well as employees. The program is made up of a number of elements: . News Services produces materials for the press, radio and tele vision, concentrating on the news media in New Xork and Washington. CMA 073527 2- - It also produces materials for member companies and local and regional organisations to help them influence local reporting. The Service handles about 20 press inquired per day. Media Tours, virtually an extension of the News Service, arranges for industry scientists to be interviewed by local television, radio and press across the country. Scientists have high credibility with the public and the media. Print Advertising gets our message to our target audiences in the form, in the place and at the time that we want them to receive it. CMA Direct Issue Support includes counsel and.preparation of brochures, white papers, etc;, for the other CMA departments. An example of such support is the Clean Air packet prepared for the Government Affairs Department. Public.Information activities focus on cooperative communi cations work with other organizations inside and outside the chemical industry such as American Women in Radio and TV, and the National Association of Farm Broadcasters. Included here are efforts to encourage company involvement in the communications program. Speakers Program seeks to encourage member companies to begin or extend their speaking programs. . Education Program carries out the Catalyst Awards program, one of the few effective entries in.-academia. :' CMA so-i/ii/aa CMA 073528 EXHIBIT C COMMUNICATIONS PRESENTATION BY ROBERT A. ROLAND TO CMA BOARD OF DIRECTORS JANUARY 11, 1982 There is a growing recognition among our association peers, media, govern ment and industry that CMA's communications program is a first-class opera tion. He have the right mix of industry leadership, talented people, in telligent programming and grade A supporting materials. No question about it. So you say. Right, Bob. You've got really fine people, programs and publications. Good work. But what about the return on our investment? How many people do we reach? Who are they? Is media getting our message? What impact are we having on public opinion? Good questions. So let's go to the bottom line and talk results. Specifically, what have we done for you lately? NEWS SERVICE, operating in a climate of controversy and hostility, we're developing a network of personal media contacts and servicing that network with no-nonsense news materials. In 1979, the Department received 1,900 phone calls. In 1981, two years later, 4,000 calls were- received, most of them from media. "Clearly, we've established a presence in the media community as an authori tative source of information. Press releases, 211 of them in the past three years, are part of the package. More than 1,700 press clippings, a fraction of the reality, have been generated. And 1*11 tell you, it's " nice to see some favorable headlines for a change. In 1981, we participated in editorial briefings-with the staffs of 30 pub lications with a circulation of 42 million--like U.S. News, Wall Street Journal, Time, and The Washington Post, Fact File is a comprehensive reference piece on the industry. More than 1,720 copies have been personally placed with newspaper editors and reporters representing a circulation of more than 15 million. We just wrapped up our year-end economic briefing for the press--total circulation represented: 5 million. Our participation in the American Women in Radio and Television convention generated 87 broadcast interviews with industry experts. I can tell you that an estimated audience of 15.6 million people received our message. Our participation in the National Association of Farm Broadcasters con- . vention resulted in 296 interviews with industry experts. Potential audi ence: More than 10 million people. . The television news feature is an important part of our arsenal. A news feature on CHEMTREC is being distributed to more than 20Q stations with a potential audience of more than 10 million viewers. Our Radio-TV Manager runs the chemical industry Radio and Television News Service-reaching more than 10,000 stations. CMA 073529 -> Media tours are the bread and butter of our news operation. CMA members and staff are specially trained to handle broadcast and print interviews. Our media tour program has generated 161 television interviews, 150 radio interviews and 91 print interviews. We've already covered 61 market areas representing a total population of over 33 million people. That's 83 mil lion people. In our current media tour season we are targeting 69 market areas with a total population of more than 85 million. Print advertising provides a synergistic base for everything else we do in communications. The ads give us a national presence that opens windows ' of opportunity--particularly with media and government. What's the impact, you say? 37.9 million people have seen our ads an average of 12.7 times. That's a bottom line of 1.1 billion advertising "impressions." And the ads have produced nearly 20,000 individual requests for our key issue booklets, an exceptionally high number for this type of ad. CMA Direct Issue Support embraces those communications activities that seek to directly improve the climate of public opinion that influences legisla tive and regulatory decisions. Our News Service and print advertising are certainly a force in the public policy arena. Our monthly ChemEcology news letter reaches 100,000 opinion leaders in academiai government and business. And our frequent ChemEcology Special Reports on key issues give us extended impact through distribution to 1,175 editors and reporters. CMA News reaches 5,500 members--all of them real or potential activists on behalf of the industry. And CMA News Special Reports expand our reach to 1,175 editors and reporters. More than 2,000 copies of our clean air back grounder, the definitive package on this key issue, were distributed to the U.S. Congress, key legislative contacts in member companies and the press. Our public information efforts employ a comprehensive array of print and audio-visual materials to reach a network of business and special interest groups and the general public. By now you've all seen our "Doing Something" film. But is the film "doing something'1 for you? Try 3,000 showings to civic groups, women's clubs and schools for a^total audience of a quarter of a million people. CMA members multiply this impact by using 250 prints to reach community audiences. Eight million viewers saw our film on cable and public television stations. Six public service announcements were ex tracted from "Doing Something." We've had an estimated 80 million viewers for our PSAs. That's right. 80 million viewers. In fact, WDVM-TV, the Washington, D.C. CBS affiliate, ran one of our PSAs over 40 times in a tough and important market of more than 3 million people. And most of that, incidentally, in prime time. "The Need to Know," our new 274-minute hazardous waste film, is in produc tion for delivery this March. Like "Doing Something," it will get full group and television distribution and will give us more PSAs and news features to put into the media stream. Our "Meeting the Challenge of Change" slide presentation is used extensively by member companies, with more than 400 sets being used to reach employees and the public. CMA 073530 3 Our group liaison efforts give us a multiplier effect through other organi zations that have considerable public credibility--like the American Here Economics Association and the Future Homemakers of America. CMA members and staff host exhibits and distribute materials at the conventions of five major groups representing a constituency of 683,000 influential^. The General Federation of Women's Clubs and the National Grange are but two of ten other organizations that we work with to help tell our story--through film and material distribution and speaker placements. There are some prestigious platforms available and we want to be on them. The bottom line is reaching million influentials--the constituents of these organizations, iyid we're doing it. As in a recent issue of the National Businesswoman Magazine, the journal of the National Federation of Business and Professional Women's Clubs, featuring the availability of CMA speakers and printed mater ials. " At the core of our print effort are six key issue booklets. The sixth book let in this series, "The Chemical Balance: Benefiting People, Minimizing Risks," a summary of our commitment to environmental health and safety is before you today. More than one million copies of these booklets have been put before the nation's opinion leaders. Our leaflets, presenting shorter statements on the key issues, have'reached a distribution figure of more than 275,000. The just-issued "Public Support Programming Action Guidebook" offers speci fic success stories of member company communications programming. 692 copies are in use and spurring industry action. There is clear evidence that our speakers program is coming to life. 3,000 copies of the OTA Speakers Resource Manual are in use by member companies. The result: Thousands of real and potential speaker appearances before em ployees, civic groups, women's clubs, schools and other appropriate forums. 39 member companies currently have or are planning such programs. I'd like to report that 200 companies are involved. We have a marvelous opportunity for some powerful eyeball-to-eyeball dialogue. >' Our education programming is modest but productive. The Catalyst Awards Program recognizes teaching excellence in high school and college chemis try. 18 educators are honored annually, generating substantial prestige for our industry in the academic community. Taking it one step further, our 315 winners to date give us a pool of blue-ribbon educators who are generally favorable to the industry--and don't mind talking about it. ChemEcology gives us another entree to the educational community--15,000 readers are teachers and students. So there you have it--hard, bottom line results. A return on your consider able investment in a comprehensive communications effort. But the real payoff comes well down the road, when we begin to see the needle of public opinion move back in our direction. It took us a long time to be consid ered the bad guys. And we won't reverse that overnight. But there are some encouraging signs. A Lou Harris poll asked respondents to rate the chemical industry's air and water pollution control efforts. In 1979, only 33% put us in the "good to excellent" category. In 1980, we hit an abysmal CMA 073531 A -A*-/.' 4 25% as EPA and activists generated a media blitz on toxic wastes. It 1981, we rebounded remarkably to a 42% "good to excellent" rating. Harris at tributes the major part of this comeback to our advertising and communica tions efforts. So the needle is moving. And we'll continue to take the temperature. Our third-stage Cambridge survey win be completed by April. And the proposed television ad test would give us an immediate fix on the impact of this medium on the public's perception of our industry. CMA B0-1/11/B2 y CMA 073532 e -I EXHIBIT lJ COMMITTEE RECOMMENDATIONS Each year the Communications Committee and the Long-Range Planning Task group review the communications program. Both have found the program on course, but needing a few "course corrections". Taking account of today's economic conditions, some of these changes will take some years to accomplish. The major,recommendation is that we should shift the overall emphasis somewhat from print advertising to more news and Issue support action. This will include a series of media background briefings involving industry key executives. An expanded effort to produce and place video news clips Is also planned. The committee recommends devoting further resources to dayto-day support of related governmental activities. More media tours by industry scientists are planned. The advertising print campaign should be extended at its ` current level, with *10 percent of the present ChemCAF advertising budget being devoted to "issue advertising". CMA and member companies should provide for communications programming at the local level, since environmentalist pressure is shifting from the national capital to the state capitals. More resources should therefore be devoted to support of the local Chemical Industry Councils. The Communications Committee feels that adverse public opinion of the chemical industry and its potential for more government regulation makes it necessary to at least develop the information the industry needs to determine whether expansion of its public support program into television might be warranted in the future. The test would produce this evidence. We would place it before you in 1983. Conversely, if the test is not carried out, the industry will never have had a chance to know the facts in this crucial area. The Committee therefore recommends proceeding promptly to carry out the television advertising test. CMA BD-1/U/S2 CMA 073533 EXHIBIT S CHEMICAL REGULATIONS ADVISORY COMMITTEE EXECUTIVE SUMMARY OF ACTIVITIES INTRODUCTION The Toxic Substances Control Act ("TSCA" or the "Act") was signed into law on October 11, 1976, and became effective on January 1, 1977. A complex and detailed statute, TSCA empowers the Environmental Protection Agency ("EPA" or the "Agency") to evaluate and, if necessary, regulate the effects of chemical substances and mixtures on human health and the environment. . TSCA1s coverage is comprehensive. It potentially applies to all chemicals manufactured, processed, distributed or used in the United States except where these chemicals are already regulated under certain other federal laws. TSCA thus affects not only the chemical industry, but the many industries that use its products. TSCA is, therefore, the primary act of con cern to the Chemical Regulations Advisory Committee (CRAC). Because TSCA has had a direct and substantial impact on the chemical industry, CRAC has made a concerted effort to express its members' views on EPA's actions under the Act, and has used a variety of formal and informal channels to communi cate with the Agency, including the submission of extensive written comments on EPA's proposed regulations. CRAC's efforts have been effective.- While the Agency has developed and articulated a regulatory approach under each of TSCA's principal provisions, very few EPA proposals have been issued as final rules and no irreversible policies have been adopted.- Additionally, EPA's new leadership is taking a fresh look at the Agency's policies under TSCA and intends to alter the Agency's course wherever a change is warranted. CMA has criticized several EPA proposals published during the last administration and awaiting final action. EPA's new leadership has reviewed CMA's comments and is re-examining those proposed rules. To aid EPA in that review CRAC published a 339-page book, "The First Four Years of TSCA." The book describes major provisions of TSCA, summarizes and references over 3000 pages of formal CMA comments on EPA's proposed rules and highlights the following nine guidelines to better imple mentation of the Act. EPA's regulatory requirements should be well within the limits of its statutory authority and clearly necessary to achieve the purposes of TSCA. -l- CMA 073534  EPA should place less reliance on formal legalistic requirements and instead emphasize voluntary action and informal negotiation to achieve TSCA'5 objectives. EPA must be more sensitive to the impact of TSCA's requirements on innovation in the chemical industry and must make greater efforts to evaluate the economic impact of its proposals. . EPA should seek information only when it is needed to further specific and defined regulatory objectives, and should not demand the collection and submission of large amounts of information for its own sake. EPA must recognize the limited resources that industry is capable of devoting to the goals of TSCA without placing overwhelming burdens on particular products and operations. EPA's proposals should avoid stifling flexibility and inhibiting scientific judgement. EPA must make a greater effort to recognize the legal and commercial necessity of protecting confidential _ business information. " EPA should take regulatory action under TSCA only after adequate data are gathered and only on the basis of scientifically defensible decisions that have been subject to peer review. EPA must recognize that the various provisions of TSCA do not stand alone, but interact with and mutually support each other, necessitating an integrated ap proach to the Act's implementation. In addition to the above guidelines, CMA developed and presented a major regulatory reform package to Vice President Bush and his counsel, the Secretary of Commerce, the Office of Management and Budget, the Regulatory Relief Task Group, and the regulatory agencies. Together, the publications are a de tailed roadmap to resolving priority concerns of our industry and to promulgating reasonable, cost-effective regulations : that embody the original intent of Congress. During the past year CRAC has continued to expand its influence within the government and the private sector and consequently to require more support from its members and its staff. -2- CMA 073535 MAJOR ACCOMPLISHMENTS CRAC has been able to achieve a high level of performance in regulatory and legislative activities, and has expanded its community, public relations and committee orientation functions by using representatives from member companies, outside legal counsel, outside consulting firms and CMA staff. Under its present task group structure, CRAC was able to address major EPA proposed or final rules under Sections 4, 5, 8 and 12 of TSCA. In addition, CRAC testified before Congress on the implementation of TSCA and was successful in preventing potentially troublesome amendments to TSCA. Communication with CMA members, EPA, Congress and the public remains an essential component on CRAC's program, which it has sought to expand through newsletters and other publications, informa tional meetings and meetings scheduled to discuss a specific topic. CRAC has also sought to define its objectives and to involve each committee member on.specific task group projects. Development of CMA comments on major rule proposals and studying the economic impact of TSCA rules on the chemical industry account for most of the budgeted funds spent during this past year. In order to maintain its high level .of per formance during 1981-1982, CRAC will continue to rely upon outside legal counsel and consulting firms for issues needing special expertise. As many proposed regulations reach final form under the new EPA Administration, environmentalist groups may litigate rules for which they believe EPA has not pro vided adequate support. CRAC will need to document its posi tions on TSCA proposals and to enter the courts where favorable final regulations are challenged or where final rules are un reasonable and pose substantial burdens. Some major accomplishments made during the past year include: Testified before the House Commerce, Tourism and Transportation Subcommittee on EPA's progress toward the implementation of TSCA. * Worked with key congressional staff to augment written CMA comments and positions by outlining and advocating CMA positions on EPA initiatives, Commented informally on a congressional subcommittee proposal which would request the Office of Technology Assessment to conduct a study examining the adequacy of test data that the chemical industry has histori cally submitted with PMNs. -3- CMA 073536  Briefed key individuals within EFA and. OMB on priority regulatory issues facing the chemical industry under TSCA and through international agreements. Conducted an economic impact analysis of EPA's proposed premanufacture notification (PMN) re quirements under Section 5 of TSCA._ - Petitioned EPA requesting that the Agency commence rulemaking and to exempt certain low-volume chemi cals, site-limited intermediates and polymers from PMN requirements under Section 5(h)(4) of TSCA. Informed the Department of State of the proposed OECD Decision adopting minimum premarket data (MPD) requirements -- i.e., testing -- for all new chemi cals . Submitted a petition to EPA requesting that the Agency modify its final export notification rule promulgated under Section 12(b) of TSCA. Prepared, in coordination with other CMA depart ments, -a detailed regulatory reform package to the . President's Task Force on Regulatory Relief, high lighting major regulations under TSCA needing immediate attention. Drafted a policy paper on the Chemical Substances Information System used by'government agencies to store and retrieve information used in regulatory decision-making. ^ Reviewed and commented on test protocols being developed by EPA under Section 4 of TSCA and by OECD. Completed the NERA pilot study examining the methodology used to measure the overall economic impact of TSCA on the chemical industry. Held quarterly Informational Meetings to keep member company representatives fully apprised of positions developed by CRAC on regulatory pro posals, the origins of those positions, and the anticipated effect they would have on company operations. Published periodic Toxic Substances newsletters which were sent to the designated TSCA contact of each member company. cmao73537 a 4s` ..  Communicated CMA positions on major regulatory issues to the media, Worked with other trade associations representing the chemical-industry to develop a uniform industry position on regulatory proposals having broad impacts. Met or talked with various "public interest groups" having an interest in toxic chemicals in general, or CMA positions on specific TSCA regulations in parti cular, to more fully appreciate their interests and concerns, and in turn, to detail CMA* s position to ensure they completely understood it and its support ing rationale. Provided input for CMA's Communications Department through articles related to TSCA that were published in CMA News, ChemEcoloqy, and other CMA promotional material. Distributed to EPA members of the trade press, uni versities, public interest groups, and law schools, copies of CMA's primer, The First Four Years of TSCA. Briefed each new CRAC member on CMA procedures and policies, and on past and current activities of the committee. . . Prepared a CRAC Procedures Book which contains rules of procedure, charters of CRAC and its task groups, and the objectives and strategies for the committee.. Held a planning meeting for CRAC members and CMA staff to determine what its long-term objectives should be and what strategies should be employed to meet those objectives in a timely manner. MEMBER COMPANY PERSONNEL The level of company participation under CRAC in FY 80-81 was comparable to that measured the year before, with a slight increase in the numberwof companies involved but with a reduction in the total amount of time spent attending CMA meetings. Figures show that 67 CMA member companies participated in various CRAC activities, compiling a total of 3.50 years of direct support through meeting, attendance alone . CRAC's activities were sup ported by 214 company representatives who are members on the com mittee and its subordinate task groups and work groups. During the first 6 months of FY 81-82, member companies increased their direct support in CMA meetings, which equates to 2.01 years. CRAC is able to maintain a high level of performance by distributing the -5- CMA 073538 work load among a greater number of companies, and through efforts to make meetings more productive by insisting on an early meeting agenda, asking company representatives to adequately prepare by obtaining company views on draft comments and company support information prior to meetings, and using written and electronic means of communication to enhance operational efficiency. CMA STAFF SUPPORT Currently, two staff executives from the Technical Department are assigned to CRAC full-time while four others provide part-time support. In addition, both the Legal Department and Government Relations Department, have assigned staff to work with CRAC on issues needing their expertise. Administrative and public relations support staff add significantly to the smooth functioning of the committee. For 1931-82, the level of staff support is expected to remain constant. Peak work loads will be distributed among staff executives assigned to CRAC to ensure constant efficient operation. / > -6- CMA 073539 Chemical Regulations Advisory Committee Report to CMA Board of Directors January 11, 1982 I interpret my assignment tod ay to be one wherein I should highlight for you the activities of your Chemical Regulations Advisory Committee (CRAC) as they pertain to the implementation of the Toxic Substances Contro1 Act {TSCA) and to indicate our thinking and plans for the coming year. , You have in.your premeeting papers, a detailed summary prepared by the CMA staff which covers all of the activities that CRAC has carried out this past year. perhaps this summary or my remarks will create some questions from the group to which I can respond at the end of this prepared presentation. Before I can effectively present to you the highlights of our past activities and plans for the future, it is appropri ate that we spend a few minutes summarizing the present status of implementation of the law. ' i. current status - Just ten days ago, TSCA celebrated its fifth birthday. It hardly seems like it has been five years since the law went into effect, but that's the way it is -- "time passes quickly when you are having fun." "' What has been accomplished in:five 'years with TSCA? The answer to that question depends on the perspective of who is answering. The Regula tors { EPA) would po %.b t wi th pride to the publication of the TSCA Inventory listing some 60*000 chemicals manufactured and/or marketed in the U.S. The Agency would extol their efforts in implementing the Premanu facture Notification (PMN) System in which over 1 ,100 new chemicals have been processed in the 2-1/2 years it has oper ated. The third point of accomplishment would be the Section 8(e) Substantial Risk Report System, wherein 420 reports have been received and reviewed. EPA says they have accomplished a lot in just five yearsI The environmentalis ts, ho we ver, answer the qua s tion differently. Prom their point of view the inventory, while published, was months late. The PMN system rules, while pro posed , .have never been finalized. They believe the Agency is accepting PMNs from industry with insufficient data and test ing on new chemicals particularly toxicological testing data. For existing chemicals, no test rules have been finalized. The Agency has regulated only a few existing chemicals - Polychlorinated biphenyls (FCBs), disposal of dioxins and certain uses of chlorof1uorocarbons and. asbestos. The CMA 073540 .. -a* . regulation of PCBs was required in the law itself and even then SPA's regulations we re arbitrary resulting in a lawsuit to begin new rulemaking. in short, the environmentalists believe TSCA has not been implemented. The law is five years old and the Agency is still not doing what Congress intended it to do, , Prom the position of those being regulated {industry), irrespective of the pace of EPA in putting rules into final fon, TSCA is working , it is accomplishing the job intended by Congress , The Inventory is published , although not com pletely - - reportedly some 5,000-6,000 chemicals have not been listed publicly. The PMN System has not been finalized, and the system proposed by EpA should not be finalized. The current interim system is operating fairly smoothly and in dustry can best communicate the risks or lack of risk associ ated with a new chemical in the "free-style" dialogue ap proach now being used . The Agency has demonstrated in over I,100 cases now that it can effectively review new chemicals for unreasonable risk using this approach. The development of test pro to cols has been a slow pro cess and it has delayed EPA's issuance of test rules. In the meantime, numerous indus try-initiated test programs have com menced on products need i n'g additional testing , whe t he r hrought into the health and safety spotlight by EPA or the companies' own initiative. Cooperative testing programs permitted under TSCA are taking place -- even though the rules are not in place to require such programs. Proa industry's point of view, TSCA is.working -- new chemicals are subjected to PMN review and testing of existing chemicals is taking place. '' The first five years of TSCA have seen numerous rules proposed by the Agency. CRAC and CM A members have reviewed thesis and in almost all cases, found the proposals to be either overly burdensome, beyond the intent of Congress, or unworkable or unmanageable for either the Agency or the in dustry. To date, we have seen none of these types of rules finalized. under the current Administration, many of the proposed rules are being reworked, almost from scratch, we are told. Just how the new philosophy of EPA will be trans lated onto paper in the form of rules is difficult to predict, but we are hopeful. II. MAJOR CRAC EFFORTS IN 1980-81I I mentioned earlier that there have been numerous ac tivities wherein CRAC has interacted wi th the Agency, Cong ress or with the environmentalists. I do not intend to take you through a long list of activities. I will highlight three areas of major strategical importance to us . In April 1981, CRAC testified before the House Subcommittee on Com merce, Transportation and Tourism at a TSCA reauthorization hearing. At that time, we outlined our concern with the EPA CMA 073541 implementation progress to date, continued to support the spirit of TSCA as passed by Congress, and recommended that TSCA not be amended at that time. It was interesting to note that neither the Agency nor the environmentalists, when specifically asked by Congressman Florio, requested amend ments to TSCA. This seemed to be disappointing to the Committee as they (Mr. Florio) expressed concern aver the lack of SPA accomplishments under TSCA. In fact, the House Subcommittee on Commerce, Transportation and Tourism con tinues to express interest in assessing* the quantity of tasting being done on new chemicals and the need for addi tional testing and information. This will be a continuing issue that we will face and will need to handle. Secondly, and this ties into the point I just mentioned, the Organization for Economic Cooperation and Development (OECD) has developed as a "Decision," ready for signature by the 24 member countries, a program which would call for a "minimum premarket data" package to be developed on all new chemicals. CRAC and the International Affairs Group ( IA G) , through the Department of State (DOS) were successful in convincing DOS that American industry did not support such a policy despite the former EpA Administration's assertion that such a policy was acceptable for the U.S. Our TSCA law does not require the generation of test data for PMNs. Had the DOS signed such a treaty on behalf of the .D.S., it would have started us down the path of amending our laws so that U.S. could live up to its treaty commitment. The "minimum pre marketing data package" would cost an estimated $50,000 to $100,000 for each new chemical. This issue is still not settled internationally and final resolution may not take place for several months. However, the call for additional testing on new chemical sub stances on three fronts -- the international^ impetus fostered by OECD, the interest of Congressman Florio's Committee, and the claim by the environmentalists that industry is not doing sufficient testing on new chemicals warrant our continued attention. CRAC has maintained that testing should be done as appropriate for new chemical substances based on its ex pected properties and use of those chemicals. This testing should not be done on a cookbook or by-the-numbers approach, but should be done on the basis of need, as judged by quali fied personnel. It is the primary responsibility of the company manufacturing the chemical to make this appropriate j udgment. We were successful in changing the U.S. position at the "last hour." We have submitted revised language for consid eration by OECD, which reconi2es the differences in existing domestic laws and regulations of all member countries. This has not been widely accepted by other OECD members , particu larly European countries pushing for MPO on all new chemi cals. We are holding to our guns here and plan to do so even CMA 073542 if it means no international agreement. Acceptance of the MPD package would represent a drastic change'in the thrust of TSCA. Our suggested rewording of the agreement does, in our opinion, protect our interests and enables each country to operate according to its laws. our third major area of activity has been to petition and pursue with EPA the granting of exemption to PMN process as permitted by Section 5(h)(4) of the Act. Our study of the PMNs submitted to the Agency disclosed that a high percentage of new chemicals were of such a nature that no unreasonable risk would be encountered in manufacturing, processing or use. The PMN system required that these chemicals be sub jected to the PMN process, which delayed manufacturing and marke t introduc tion unnecessarily and at a cost which was not justified. The available evidence from studies done on the innova tion of new chemicals also indicated there was a significant drop in the number of new chemicals being introduced because of the cost of the PMN system. It is estimated there has been approximately an 80% reduction in new chemical introduc tions since TSCA came into effect. This is in part due to the combination of cost burdens of the PMN system and com panies' reluctance to engage' in new ventures due to regula tory and cost uncertainty. We believe our petition for exemption would significantly ease the adverse impact of TSCA PMN notifications on innovations. . Our petition to EPA calls for exemption from all or part of the PMN system site-limited intermediates, small volume chemicals (less than 25,000 lbs/yr), polymers and those chem icals for which the Agency determines no unreasonable risk exists prior to the 90 days of the PMN review period. The Agencyhas expressed interest in our concepts and we are currently discussing with the EPA staff the additional de tails they need to develop in a rulemaking for such exemp tions. We are hopeful we can have all of these exemptions available to the industry by the end of the summer of 1982. III. CRAC OBJECTIVES, 1981-1982 I indicated earlier, that l would talk about our plans for 1981-1982. At our two-day CRAC planning meeting, which we he last October, we recognized several items that warrant our attention in CRAC, and for that matter, in CMA as a whole.1 1. Many points within the government and society exist where pressure will develop, and is now developing, which can influence the course of TSCA implementation. While we have spent the great bulk of our time interfac ing with EpA, we see other branches of government, such as. Congress, Office of Management and Budget, Govern ment Accounting Office, and Office of Technology CMA 073543 Assessment and regulatory reform activities as playing a timely role as TSCA moves to ward full implementation. We will broaden our approaches to include identification of these pressure points and to take appropriate action. The continuing interest of Congressman Florio's Subcom mittee on the adequacy of PMN data is a good example of how groups other than Ep A will need our attention. Where other CMA committees, such as the Government Relations Committee, can help us, we will employ their services or coordinate our activities with them. 2. Since industry supported TSCA, as it wa3 ultimately drafted and passed, we believe that the statement "TSCA is a workable law when implemented in a reasonable and timely fashion" appropriately expresses the industry's and CMA 1 s continued support for the principles and spirit of the law. it is our belief that despite the lack of regulatory action taken by EPA (final rule making, etc.) that the law is having its intended effect on the behavior of the industry. We have, in an infor mal way, surveyed part of our membership and developed a long list of actions that have occurred as 'a result of the passage of TSCA and the- public opinion climate , which produced TSCA as a law. we plan to further de velop this type of information, to publicize and use it to help quiet the claim that TSCA is "not working. If Congress perceives that TSCA is not working, it might ultimately begin efforts to amend TSCA adversely. The effectiveness of TSCA may be reviewed and scrutinized during the next congressional year in oversight hear ings Our approach is to work to assure there is no perceived need on the part of. Congress to adversely amend this Law. Should amendments be sought by others, wej are prepared to advance those changes which we believe would improve TSCA from industry's viewpoint. 3. We are developing conceptually, a plan for how TSCA can be effectively implemented while complying with the statutory limits of the law. This plan is based on CRAC< s review of EPA proposals and constructive comments we have submitted . These are summarized in the book -"The First Four Years of TSCA" which has been highly effective and well received by the new EPA Administra tion. We plan to work with the Agency to encourage a full implementation of the Act. We believe there exists now with the present Agency management a "window" through which we can get implementation achieved in a reasonable manner" . We want to eaptalize on this op portunity, since subsequent administration might not be as favorable. Rules that can be finalized now will be more difficult to change later on. CMA 073544 T5 JF VT . 4. Finally, we will continue to pursue to a successful completion, our petition for PWN exclusion and resolu tion of the MFD issue. We will continue to respond to all EPA-initiated activities to assure they comply with the thrust of TSCA and represent reasonable implementation. IV. CONCLUSION This has been a very quick summary of where we are - our accomplishments and our plans. TSCA is working and is, as expected, affecting our business, both in dollars and cents, as well as in the way we do our business. To date, TSCA implementation to EFA has been slow. The past SPA Administration was quite aggressive in proposing rules that pushed to the outer limits and beyond, the thrust and intent of TSCA as envisioned by Congress. We in CRAC sense a change in direction, at least at the top positions of EPA under the Reagan Administration. We should see considerable progress In implementing TSCA within the next two years. CRAC will be working to assure that this impleoentation is in reasonable step with the legislative intent that our industry supported in 1977. I believe CRAC has1 been and will continue to be an effective tool for the industry, representing our industry's interest well at EPA and helping to demonstrate industry's commitment to good corporate eitizenship. CMA BD-L/11/82 CMA 073545 ' V<