By Daniel Whitten Sept. 29 (Bloomberg) — PG&E Corp. quit the U.S. Chamber of Commerce. Nike Inc. and Johnson & Johnson criticized the group for its stance. Duke Energy Corp. resigned from the National Association of Manufacturers. Climate-change legislation is splitting the U.S. business community as few initiatives have in recent years. Groups such as the Chamber of Commerce , more accustomed to tangling with unions and environmentalists, find themselves facing off with prominent members who are defecting or joining new organizations to promote and shape legislation. The chamber and the manufacturers’ association oppose President Barack Obama’s effort to win passage of a “cap-and- trade” system that would limit carbon emissions to curb global warming. The groups say the proposal amounts to a tax that would cripple the economy. The chamber says the science used to document global warming should be re-examined. Peter Darbee , PG&E’s chief executive officer, cited the chamber’s “extreme rhetoric and obstructionist tactics” in a resignation letter to Tom Donohue , president and CEO of the Washington-based group, made public last week. “Climate change is central to a lot of companies’ business models, so what happens is that the CEOs have been personally involved,” said Michael McKenna , president of MWR Strategies, a Washington consulting firm, in an interview. That makes companies less likely to leave the issue to trade associations such as the chamber, he said. Exelon, PNM The House of Representatives passed a climate bill in June, and the Senate may consider its version this week. Exelon Corp., the biggest utility owner by market value, yesterday joined the companies going public with their opposition to the chamber’s position. John Rowe , CEO of the Chicago-based company, told a conference in the city that Exelon wouldn’t renew its membership in the group. PNM Resources Inc., a utility based in Albuquerque, New Mexico, said in a statement last week that it will let its membership expire at year-end. Charlotte, North Carolina-based Duke Energy, owner of utilities in the U.S. Southeast and Midwest, said in April it won’t renew its membership with the National Association of Manufacturers . “We want to invest in associations that are pulling in the same direction we are,” CEO Jim Rogers said at the time. The manufacturers’ group has published a study saying the bill passed by the House would result in the loss of 2.4 million jobs and add 50 percent to the price of electricity by 2030. The association this summer ran advertisements blasting the measure in 13 industrial states including Ohio and Indiana. “More taxes. What is Congress thinking,” the ads ask. Maureen Davenport , the manufacturing group’s spokeswoman, wouldn’t comment directly on Duke’s defection, or on whether others have left over the issue. Joining Environmentalists Twenty-five companies, including General Electric Co., Caterpillar Inc. and Dow Chemical Co., have joined with environmental groups in the U.S. Climate Action Partnership to promote cap-and-trade legislation. Most of the companies remain members of business associations that oppose the measure. “In many cases environmental groups have been heads-down focused on environmental issues without regard to cost consequences or international competitiveness and jobs,” said James Owens , CEO of Peoria, Illinois-based Caterpillar, which remains in the chamber. “And in some cases, industry has been focused on jobs and profits without much consideration for the environment, so this kind of forces everybody to the table,” Owens said in an interview. Close to Customers GE, the world’s biggest provider of power-generation equipment and services, remains in both the Chamber of Commerce and the manufacturers’ group “to stay close to our customers and to hear differing views on issues of national importance,” said Peter O’Toole , a spokesman for the Fairfield, Connecticut- based company. “However, neither represent GE’s view on the need for advanced energy and climate legislation,” he said. The chamber has attacked how the Environmental Protection Agency uses data to support the existence of global warming. “We need to drop the articles of faith and use the entirety of scientific study” rather than material chosen for “its ability to forward their policy goal,” Brad Peck, a senior communications director, wrote of the EPA on the chamber’s Web site in August. Last month, William Kovacs , chamber senior vice president, was quoted by the Los Angeles Times as saying an inquiry would be like the Scopes trial on evolution. “It would be the science of climate change on trial,” he said. Kovacs later said in a National Journal blog that the analogy “was inappropriate.” Strong Views Darbee, CEO of San Francisco-based PG&E, said the chamber may have been listening to members who are adamant about the issue. “Oftentimes there is a small group of people that have very strong views who are getting control over an organization,” he told reporters in Washington last week. Nike, the largest maker of athletic shoes, “fundamentally disagrees with the chamber’s position on climate change,” Erin Dobson, the company’s director of corporate responsibility, said in an e-mail. Boston-based Green Century Capital Management Inc . and other investors will urge Nike to terminate its membership in the chamber in a letter being sent to the company today, said Emily Stone, a shareholder advocate for Green Century. Green Century runs $95 million in mutual funds that invest in companies it considers environmentally responsible, Stone said. Johnson & Johnson, the world’s largest maker of health-care products, also took issue with the chamber’s approach to climate change in a letter in April urging it to represent the full range of views within the organization. ‘Different Vested Interests’ Eric Wohlschlegel , a spokesman for the chamber, said the group has a “democratic process” in making policy. Donohue, the chamber CEO, is on the board of directors of Union Pacific Corp ., the second-biggest U.S. railroad, which opposes cap-and-trade legislation. Donohue’s board memberships and all chamber policies are approved by the group’s board of directors, Wohlschlegel said. The chamber didn’t make Donohue available for an interview. Differences over climate change won’t do permanent damage to traditional business alliances, Caterpillar’s Owens said. “It’s always been difficult on controversial issues to get the entire business community working together,” said Owens, whose company, the world’s largest maker of construction equipment, belongs to both the chamber and the U.S. Climate Action Partnership. “We have different vested interests.” To contact the reporter on this story: Daniel Whitten in Washington at dwhitten2@bloomberg.net
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