SISTER PATRICIA DALY: Good morning, Mr. Welch, members of the board, and fellow shareholders. My name is Pat Daly. I am a Dominican sister, and I am here representing the Interfaith Center on Corporate Responsibility. ICCR has been raising very critical issues before U.S. corporations for almost thirty years. We represent about $90 billion of investment money.

Today, I would like to discuss the resolution on the necessity for public education about General Electric's pollution around the Hudson Valley. The Hudson River is the largest PCB spill on the planet. It is also the largest Superfund site in the country. Most of those PCBs are in the river because of the past practices of General Electric. We also have been contacted by G.E. employees in the beautiful Berkshires and along the Housatonic River watershed who are facing similar situations. This is a serious concern for people who have given their lives to General Electric and have been very grateful to be a part of the G.E. family.

Mr. Welch, we will probably never agree on the science of PCBs. We did agree last year that certainly PCB-contaminated fish should not be eaten by people along the Hudson Valley. We have asked, and we continue to ask, General Electric to work with us on a publiceducation program. So many people along the Hudson Valley depend on the river to feed their families. It is not common knowledge that people should not be fishing and feeding their families on a regular basis from the Hudson. So we are asking again that you join us in educating people about the hazards they face.

JOHN F. WELCH JR.: Thank you. Before we have any more comments on this, I would like to put the company's position on PCBs in perspective for all of you.

PCB use by General Electric has always been lawful. It is critical to know that our use of PCBs, every day we ever used them, was lawful. We did not manufacture PCBs; we bought them. Starting in the 1940s, General Electric and every electrical manufacturer used PCBs in electrical equipment for a very important reason: safety. PCBs were used in capacitors and transformers to prevent fires. Government codes mandated the use of PCBs in electrical equipment. In the mid-1970s, the government changed its position and banned the continued production and use of PCBs. Your company complied immediately.

PCBs do not pose health risks. Based on the scientific evidence developed since the 1970s, we simply do not believe that there are any significant adverse health effects from PCBs. More than twenty studies show absolutely no link between workers and others with elevated PCBs in their blood, and cancer and other adverse health effects.

I want to make it very clear to all of you that we, your company, will base our discussion of PCBs, as we have for twenty years, on science, not on bad politics or shouting voices from a few activists. Science will decide this issue. Advocates can shout loudly. They can say anything. They are accountable to no one.

DALY: Mr. Welch, you are right. We are all accountable, and you know who I am accountable to.

WELCH: No, I do not. I would like to

DALY: I truly think my accountability is ultimately to God, which is why

WELCH: And I think mine is also.

DALY: I am not judging that. What I am saying, Mr. Welch, is that this is an issue of public education.

WELCH: Sister, why not take public education right to the government and have them educate the public on the situation. It is not our job to educate.

DALY: It is, however. Let's get this absolutely straight. The EPA continues to list PCBs on its suspected-carcinogen list. For you to be saying that PCBs are perfectly harmless is not true. I really want our company to be a credible mover on this. We all remember the images of the CEOs of the tobacco companies swearing that they were telling the truth. Do they have any credibility in the United States today?

WELCH: That is an outrageous comparison.

DALY: That is an absolutely valid comparison, Mr. Welch.

WELCH: It is outrageous.

DALY: Mr. Welch, I am sorry, but we need to have the independent scientific community decide this, not the G.E. scientific community.

WELCH: Twenty-seven studies, twenty-one of them independent, have concluded that there is no correlation between PCB levels and cancer, Sister. You have to stop this conversation. You owe it to God to be on the side of truth here.

DALY: I am on the side of truth. The other consideration here is that this is not just about carcinogens. We are talking about hormonal disruptions, fertility issues, and developmental problems in children. Those are real issues, and certainly those are the issues that my sisters are seeing in schools all along the Hudson River. That is exactly what is going on here.

WELCH: Thank you very much for coming, Sister. Let's move on to the next agenda item.