Nader Takes On General Motors

When Ralph Nader began his political career as a consumer activist in the early 1960’s, taking on a huge opponent like General Motors was just what he had in mind. In 1965, Nader wrote “Unsafe at Any Speed” which criticizes the auto industry and in particular condemned the early Corvair autos built by GM. Soon after publication, GM’s legal department opened an investigation on Nader’s private life. Nader saw this as a form of harassment invading his right to privacy and eventually brought suit. Although the company settled out of court for $425,000 and apologized, they would soon find Nader back again.

Prior to the settlement, Nader had established an organization of young lawyers called the Project on Corporate Responsibility. Nader, as spokesman, announced that his project’s endeavor would be directed at “the establishment of enduring access to corporate information, effective voice for affected social and individual interests, and thorough remedy against unjust treatment.”

In 1970, Nader approached GM again in an attempt to make changes in General Motors’ investor relations. Nader and his group announced “Campaign GM” would “seek to persuade GM’s shar

· Proposal 1 would add three public representatives to GM’s twenty-four member board.

Nearly 30 years after Nader published “Unsafe at Any Speed,” there are safety standards and air bags in cars. These two changes are just a few of many that Nader had influenced. Nader’s work, however, did not go unnoticed as he was named among “The 100 Most Important Americans of the 20th Century” in the fall 1990 issues of Life magazine.

After the Securities and Exchange Commission ruled on the proposals, only two had been left standing with one already amended. Nader’s primary message to shareholders was basically that GM makes “congested and inefficient” means of transportation and that customers should not be responsible for large repair bills because of careless workmanship. Obviously, GM would not let Nader voice his opinion without a response. The vice-president of public relations for GM issued a notice to all shareholders. In the letter, GM chose to take middle ground while answering all charges but avoiding response which would invite further speculation of wrongdoing.

The following year came time for the next annual meeting. Campaign GM offered three more proposals that were all added to the list of issues to be discussed. Among the three included: stockholder democracy, constituent democracy and disclosure. To the dismay of Campaign GM, all three proposals were defeated once again by massive majorities. Regarding the public relations function for GM, one shareholder issued a proposal to add a public relations counselor to have a seat among the dominant coalition. The vote on this proposal was “95.73 percent opp

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