Latin America and the Caribbean

CITYPAGES (Minneapolis/St. Paul)
11 August 1993


By that, Johnson means Fuller's trademark commitment to charitable work. The company is currently working on taking its policy of giving 5 percent of profits to charity worldwide, and managers everywhere are encouraged to help the poor: In Peru at one point, a manager responded to a slump in sales by turning one of his giant glue-boiling vats into a cooking pot to make porridge for the hungry. Fuller's annual community affairs report also features pictures of smiling street children in Honduras, where the company helped organize a "day program" for them.

Even Casa Alianza was a recipient of Fuller's largesse, though Harris says the funding was terminated this year. Before that, Harris says Fuller funded his organization to the tune of "about $100 a month, which is the salary for one streetworker. And we're grateful for that--though most of our contributors don't go around talking about it that much." But, Harris adds, whatever Fuller is spending is "pocket money" for a corporation their size. Last year Fuller reported $18 million in operating earnings from Latin America, a 16 percent increase over the previous year. The company couldn't say exactly how much it was spending on social programs with street children; for all of Latin America, Fuller reported spending just over $200,000 on charity in 1992.

"The point is," Harris says, "if they're so concerned about children, I would think that they would look at all the possible alternatives that there were for doing so. They would experiment with everything they can get their hands on. Instead, they've been very stubborn."

OK. Forget for a moment about oil of mustard. Fuller has actually done something much more radical than testing an additive, or even funding a couple of streetworkers: It's pulled its glue off the shelves.

At least that's what it looked like about this time last year, four days before reporters from Dateline-NBC came to interview Fuller executives for a critical story on Resistol. After years of saying that to stop selling the glue would spell disaster for Central American workers and customers, Fuller's board of directors resolved to discontinue production and sales of its adhesives "where they are known to be abused."

That sounded pretty straightforward, and it was read that way. "I am very, very pleased," exulted a member of the Coalition on Resistoleros, a small Twin Cities activist group that had picketed Fuller's shareholders' meeting just a month earlier. Local editorial writers did backflips. "Kids before profits--H.B. Fuller's way," gushed the StarTribune, while the Pioneer Press sternly noted that "no doubt there are activists who find irresistible any opportunity to blame Third World woes on profit-hungry American corporations. But the charge just won't stick to the facts of this case, or the record of H. B. Fuller."

What nobody thought to ask--or what Fuller managed to avoid talking about--was what exactly the company meant by saying it would stop sales and production "where the products are known to be abused." Did it mean worldwide--since, according to Johnson, abuse of Fuller products probably exists in many countries, though it's not as readily associated with Fuller brands? Did it mean in Latin America, where the Resistol trademark had acquired such unflattering meaning? Did it mean in Central America, where Bruce Harris had launched what one Fuller spokesman calls "his attempt to assassinate our reputation?"

What Fuller meant--or at least what it ended up doing--was top discontinue Resistol sales in two Central American countries, Guatemala and Honduras. And in those two countries, it only stopped retail sales--not all sales, and no production. It also ran ads in major newspapers, showing a brown-eyed child under the headline "Because We Care," reminding readers that there were other brands of toluene-based glue on the market, and warning that "we will initiate legal action against those who use our trademark without permission."

Why Honduras and Guatemala were singled out is another question Fuller has answered in different ways. Johnson eagerly admits that the board's decision wasn't based on research: "It was basically another thing we thought we'd try, another experiment." Guatemala and Honduras, he says, are the countries where a significant amount of glue is sold through midsize distributors, who in turn sell it to shoemakers by the pail. Those distributors now no longer receive Fuller glue; it's only sold to industrial consumers, who but it in 55-gallon drums and use it right on the premises. Any chance that the glue could get out from those facilities? Sure, says Johnson: "Could people steal it? Could people steal yellow note pads from this office? Yes. But I don't think it's a significant problem."

What Johnson's reasoning doesn't take into account is that the glue racket doesn't seem to operate on gallon-a-day sales from retailers. According to a recent Honduran newspaper article, one couple recently busted for selling glue to street kids had two 55-gallon drums in their basement. Police failed to record the brand name, but speculated that the glue had come from a factory.

But if the effect of Fuller's decision on the streets of Guatemala City and Tegucigalpa was minimal, the results back home couldn't have been better. Not only had the company averted what started to look like an avalanche of negative stories (Inside Edition and the Wall Street Journal both followed up on the Dateline segment, prompted in turn by a story in The Progressive)--it actually improved its public image through the glue story. News organizations that carried front-page stories about the board decision to "pull the product" didn't chronicle the outcome.

Instead, Minneapolis-based Business Ethics magazine (whose publisher once told a reporter that "I am never going to be doing an expose on an oil company in Guatemala--there's too much of that [kind of journalism] out there") picked the firm as its "Company of the Year." And the progressive Economic Policy Institute in Washington, D.C. nominated Fuller for its "America's Corporate Conscience Award" in the category "Community Involvement--Youth," specifically referring to the Resistol decision. Activists say that when they questioned the nomination, institute officials told them they'd checked Twin Cities newspapers and not found any reports to contradict Fuller's story.

"It was a brilliant move," acknowledges Bonnie Hayskar, a St. Paul writer and member of the Coalition on Resistoleros. "Because the way they handled it, they were able to define the problem. They decided that it was severe in some countries, and not in others. They decided that the problem was retail sales, not industrial. And because of the way they defined it, they were able to define that they solved it."

Even with such skillful management, another company might not have been able to escape further scrutiny. But Fuller has a bid advantage: Its good name, its dollars, and its employees are woven so deeply into local politics, business, media, and nonprofits that to tug at its reputation means to rip big holes into the fabric of Minnesota Nice. "It kind of reminds me of these stories of everyone's favorite coach being exposed for child abuse," Hayskar muses. "Nobody wants to hear about it."

For starters, there are the personal connections. According to an analysis by CityBusiness, Tony Andersen alone sits on 12 local corporate and nonprofit boards, including the University of Minnesota's Carlson School of Management, the Hazelden Foundation, and Cowles Media, parent company of the StarTribune. His father, Elmer, has his own newspaper chain, ECM Publishers, Inc. and Minnesota Public Radio receives $40,000 each year from the Fuller Foundation for its broadcasts of the Minnesota Orchestra.

Other Fuller-funded organizations include the Guthrie Theater, the Walker Art Center, the Minnesota Civil Liberties Union, and the University of Minnesota, whose chair in business ethics was endowed to the tune of $1 million by the Fuller and Andersen foundations. The current occupant of that chair is Norman Bowie, the expert most often quoted in local news stories on the glue dilemma.

And when members of the Coalition on Resistoleros turned to local and national human-rights groups, their advances were turned down with the simple argument that "Fuller is a good company." Some of those organizations, it turned out, also received help from volunteering Fuller lawyers and executives.

Plugged into the power network like everyone else, local media haven't exhibited a lot of aggressiveness about Fuller. When the Resistol story broke last year, only CityBusiness picked it up. A few months later, the StarTribune ran a glowing profile of Tony Andersen that never mentioned glue-sniffing. Inside Edition producers say they wanted to talk with publisher Joel Kramer about Fuller, but their interview request was turned down.

Fuller's network extends even to nooks and crannies another company might overlook: In Guatemala, Bruce Harris says Fuller suggested to a member of Casa Alianza's board of directors that he talk to Harris about his aggressive stance. Closer to home, friends of Fuller in St. Paul's St. Anthony Park area complained to the neighborhood newspaper when it ran an opinion article by activist Annie Baker. The paper, also a beneficiary of Fuller grants--should've run the story by the company's PR department first, critics suggested. The St. Paul Pioneer Press, dealing with a similar opinion piece, did just that.

In addition to its network, Fuller has taken advantage of a key principle of corporate relations: Get your story out first, and your critics will bear the burden of refuting it. That's how the glue issue could be defined as a "blemish" on an otherwise spotless reputation, rather than as one of the problems created by a large, multinational chemical company.

Good communications work is also how Fuller has maintained its spot in the hearts of the socially responsible investors, who've done much to help its stock soar over the years. Ironically, this is where Fuller critics had hoped to find their best allies: among politicized boomers seeking guilt-free sticks. But no matter how many packets of information the coalition sent out to ethical investment firms, they got the same response: The Resistol situation just wasn't bad enough to trigger the "screens" socially-responsible funds use to sort the good guys from the bad guys. Commonly used "screens" include business in South Africa and Northern Ireland as well as poor relations with women, minorities, and the environment; "sin" industries like tobacco, gambling, and liquor are also no-nos.

But since social investment funds, like any others, are obliged to make money, they usually invest in the same Fortune 500 companies as everyone else (minus the really bad guys and plus a few really good guys)--which means their screens can't be too rigorous. Fuller, for example, has done beautifully on environmental indexes due to its recycling program and worldwide toxics reporting policy. Never mind that the company's stock-in-trade is hazardous chemicals, that it is involved with several hazardous waste sites, and that at one point, it got the state Legislature to pass a special law allowing it to use 900,000 gallons of water a year for air conditioning. (Fuller said the water, once cycled through its building, was needed to fill up the wetlands in its nature preserve.)

It's also no problem that Fuller recently began a joint venture in China manufacturing, among other things, glue for cigarette paper for the growing East Asian market; social investors' screens cover only cigarette makers, not their suppliers. And the fact that Fuller sells lead- and mercury- containing paint in Latin America, even though such paint was banned in this country long ago because of its danger to children, has not attracted so much as a raised eyebrow.

John Schultz, president of Minneapolis-based Ethical Investments and another oft-quoted expert in Fuller stories, nicely sums up his industry's assessment: "In the realm of major corporation management in America, they are very, very close to the top." And as for Resistol, he offers this analogy: "Would you really blame General Motors if a nine-year-old takes out their car for a spin, doesn't know how to handle it, and kills three people?"

Clearly not: More than a year after the glue controversy hit, Fuller this June was one of two sponsors of the annual convention for the trade group Social Investment Forum (motto: "Buy Low. Sell High. Don't Sell Out.": Tony Andersen got a roaring ovation for his keynote speech on the glue issue.

It's unlikely that Fuller will be heartbroken by the fact that the Coalition on resistoleros has announced it won't meet with company executives anymore unless they provide certain detailed research and financial information. And the company probably won't be threatened too much by the fact that Guatemalan legislators this month are set to consider their first-ever law requiring oil of mustard in toluene-based glues, with fines on violators to be used for drug treatment centers. Johnson says Fuller will comply if the law passes, but first it will make its position known.

Fuller might be a little bit worried about the fact that Bruce Harris's organization has lawyers working on a civil suit against Fuller; it's based on the case of 14-year-old Joel Linares, who died just before Christmas 1992 with doctors certifying that his kidneys failed because of a seven-year glue addiction. Harris says Fuller managers tell him that "they have someone who will testify Joel wasn't sniffing Fuller glue."

For the resistoleros, the best hope short of a sharp economic upturn in Central America (fat chance) may be that Fuller will develop a water-based glue, which would not be as dangerous to sniff. Harris says he was told last year that Fuller would have such a glue on the market within a few months. But Johnson says there's no telling when the new formula might be done.

"The ultimate question," concludes Ethical Investments' John Schultz, "is at what point does a manufacturer of a product absolve itself from the responsibility for its product? That's a question that we in a capitalist society haven't figured out. What responsibility do you have for CityPages? Does it end when someone takes it? Does it end at the trash can? In the landfill?"

It's a good question--good enough to make you want to look the other way, rather than face the answer.


News intern Laurance N'Kaoua contributed to this story.

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