Dow Chemical Shareholders Call on
Securities & Exchange Commission To
Investigate Misleading Statements

Contact: Shelley Alpern, Trillium Asset Management Corporation (617)
292-8026, x 248 Lauren Compere, Boston Common Asset Management, LLC (617)
720-5557 Sanford Lewis, Attorney (781) 894-0709

BOSTON, August 10, 2004 – Shareholders of Dow Chemical have formally asked
the Securities and Exchange Commission to investigate misleading statements
by management concerning the company’s potential environmental and personal
injury liabilities. In a letter sent August 10, 2004 to the SEC, Attorney
Sanford Lewis, representing the shareholders, requests scrutiny of "a number
of inadequacies and irregularities in disclosures and public statements"
that are "highly relevant to the financial interests of investors."

Transgressions cited in the letter filed to the SEC include misleading
statements made to shareholders by Dow’s CEO regarding the 1984 Bhopal
explosion, dioxin contamination in Midland, Michigan, and key omissions in
company SEC filings regarding potential liabilities related to the company’s
manufacture of the chemical defoliant Agent Orange.

"These statements and omissions raise an array of concerns regarding the
company’s compliance with SEC rules and guidelines as well as with the
Sarbanes Oxley Act," Lewis stated.

Lewis represents Boston Common Asset Management (www.bostoncommonasset.com
<http://www.bostoncommonasset.com/> ), which filed a 2004 shareholder
resolution asking Dow to issue a report on any new initiatives addressing
the needs of the survivors of the Bhopal chemical disaster and to assess the
impacts the Bhopal matter may pose to the company, its reputation, its
finances, and its expansion in Asia. The
resolution was filed on behalf of the Brethren Benefit Trust. Lewis also
represents Trillium Asset Management (www.trilliuminvest.com
<http://www.trilliuminvest.com/> ), which filed a shareholder resolution
with Dow for the 2003 and 2004 shareholder meetings (2004 resolution not
included on proxy) on behalf of a client. The Trillium resolutions requested
disclosure regarding the company’s activities relative to dioxin and
persistent bioaccumulative toxic substances.

This shareholder letter comes at a time of particular scrutiny for Dow.
According to an August 8, 2004 New York Times report, the company is
currently facing lawsuits by American veterans who claim they learned of
health problems related to their exposure to Agent Orange only after funds
associated with a 1984 class action settlement had dried up. As one
plaintiff, battling cancer for over a decade, told the New York Times of his
exposure to Agent Orange, "we didn't know that it was more dangerous than
the enemy." Another suit, filed on behalf of four million Vietnamese, states
that supplying Agent Orange was so utterly destructive to their land and
people that it amounts to a war crime.

"We believe that Dow Chemical faces potential liabilities in the billions of
dollars stemming from the toxicity of its products, both in the U.S. and
abroad," said Shelley Alpern of Trillium Asset Management.

Misleading Statements About Bhopal

Indian courts have ruled that Dow subsidiary Union Carbide is an absconder
(fugitive) from justice due to its refusal to face pending criminal charges
in connection with the 1984 chemical explosion in Bhopal that killed 8,000
and injured at least 150,000.

Dow CEO William Stavropoulos gave misleading responses to shareholders at
the 2004 annual stockholder meeting, according to the letter filed today.
Stavropoulos responded to shareholders’ questions by misleadingly stating
that criminal charges had been reduced to "misdemeanor status", and then
denied that the U.S. Circuit Court of Appeals had invited the Indian
government to comment on allowing a suit to proceed in U.S. courts for
remediation of contamination at the Bhopal site.

Lauren Compere, Chief Administrative Officer at Boston Common Asset
Management, said "we find it very disturbing that when questions were raised
by shareholders at the annual stockholder’s meeting regarding the status of
the criminal case in India against Union Carbide Corp., Mr. Stavropoulos
continued to provide misleading statements. His statement that the
employees, who operated the Union Carbide’s Indian subsidiary had faced
charges against them and had their charges reduced to misdemeanor status
implied that by extension the company as a whole was no longer an absconder
from justice. In fact there remains an unanswered case pending against
Union Carbide Corp., the parent company, and the charges against it have
never been reduced."

During the stockholder meeting, Compere asked Mr. Stravopoulos for
clarification of "legal risks" associated with addressing survivors’
concerns. The company has stated that there are significant legal risks
associated with any effort to address the concerns of survivors, and yet
simultaneously says Dow has "no" liability for Bhopal. This contradiction
demands clarification.

The shareholders’ letter also highlights a misleading statement on Dow
Chemical’s website, which continues to assert that Dow has absolutely no
outstanding liability or responsibility in relation to the Bhopal tragedy or
the Bhopal site (see

Misleading Statements Regarding Potential U.S. Liabilities

The company is facing major litigation associated with dioxin contamination
in Michigan, including a class-action suit for medical monitoring and
property damages and likely responsibility for extensive remediation.
Plaintiffs state that Midland’s floodplain is contaminated with dioxins for
at least 22 miles downriver from a Dow facility. In response to
shareholders’ questions at the 2004 stockholder meeting, Stavropoulos made
claims that may prove to be materially misleading, asserting "there’s no
health effects" from low exposures to dioxin, and that "the facts have shown
that chloracne, so far…is the most severe illness that is shown."

"Dow is in a state of deep denial. Scientists consider dioxin to be one of
the most toxic man-made compounds ever tested. It is a ‘class one’
carcinogen, and is highly implicated in a variety of other health effects
such as endometriosis, diabetes, cardiovascular disease, decreased
testosterone, immunotoxicity, and altered sex ratios," said Shelley Alpern,
Director of Social Research and Advocacy at Trillium Asset Management.
Trillium Asset Management filed a shareholder proposal in 2003 concerning
dioxin and other persistent pollutants that accumulate in human tissue. "Dow
is being sued by hundreds of Michigan residents. Investors need honest
projections of potential liability, not comments filtered through
rose-colored lenses."

Financial Services Firm Identifies Reporting Omissions

The shareholders’ letter also references a 2004 report by Innovest financial
advisors (
http://www.innovestgroup.com/pdfs/2004-04_Dow_Report.pdf) that
reports that Dow has failed to disclose in its SEC filings potential
liabilities related to Agent Orange, the chemical defoliant used in the
Vietnam War, and relating to Dursban, a Dow pesticide brand.

Numerous U.S. and foreign veterans groups and Vietnamese citizens affected
by Agent Orange exposure have recently sued Agent Orange manufacturers,
including Dow. In addition, a 2003 U.S. Supreme Court decision, the letter
states, "may open the door for Vietnam veterans not covered under a previous
settlement…with a right to pursue liability of Dow Chemical for alleged
health risks associated with the chemical defoliant commonly known as Agent
Orange. Given the number of claims and the extent of damage alleged to be
caused by Agent Orange, the proceedings could result in sizable ongoing

The Innovest report also indicates that Dow failed to disclose in statements
to investors its $2 million settlement of a consumer fraud lawsuit brought
by the New York State Attorney General in 2003. The payment, which set the
record for a consumer pesticides suit, settled charges that Dow had falsely
advertised Dursban as safe, when it is believed to be associated with
illness in thousands of exposed people, including potential neurological
damage to children. Dow had previously been fined approximately $730,000
for failing to disclose adverse effects associated with the use of and
exposure to Dursban.

For the text of the shareholder letter, see

For analysis of Dow Chemical’s potential liabilities associated with Bhopal,
Agent Orange, dioxin contamination, Dursban and other environmental issues,
see Dow Chemical: Risks for Investors, Innovest, 2004

Attorney Lewis is a leading expert on corporate environmental accounting and
coauthor of the recent report, "Fooling Investors, Fooling Themselves"
(www.rosefdn.org) which identified leading accounting and asset management
strategies used by corporations that can lead to poor disclosure of
environmental liabilities and corporate accounting fraud.


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