Eighteen big-name restaurant, food, grocery and seed companies face proxy fights led by opponents of genetic engineering in the largest wave of social-issue shareholder activism since corporations were challenged for doing business in apartheid-era South Africa.

Religious groups, environmentalists and socially conscious investment funds have flooded the companies with proposals that would require shareholder votes on the controversial issue of genetically modified (GM) foods. The proposals demand that companies such as DuPont and McDonald's halt the development, use and sale of GM crops and foods until long-term tests prove them safe for humans and the environment.

Genetically modified crops are grown from seeds implanted with genes from other organisms. The implanted genes give corn, soybean and other crops desired traits such as resistance to bugs, weeds and chemicals.

The anti-GM shareholder resolutions, which are aimed at companies holding annual meetings this spring, are the first on the issue, says the Investor Responsibility Research Center, which tracks the proposals. The group says no issue has generated as many proposals since apartheid, which officially ended in 1991.

The GM issue "is galvanizing. We're being fed this food without knowing it," says Ariane van Buren of the Interfaith Center on Corporate Responsibility, which advises institutions investing money for Catholic priests and nuns, Protestant ministers and Jewish rabbis.

In an effort to keep the GM proposals from coming to a vote, companies can challenge them before the Securities and Exchange Commission on the grounds that they unfairly hamper management or are irrelevant.

Monsanto, a biotechnology pioneer that has been criticized by anti-GM activists worldwide, is the only company not to challenge at the SEC.

"We're confident our shareholders understand biotechnology well enough that this resolution will have little support," Monsanto spokesman Dan Verakis says.

The SEC is reviewing all but one of the other proposals. Two weeks ago, the commission ruled against PepsiCo, which had argued that an anti-GM resolution infringed on management decisions. Ironically, PepsiCo's Frito-Lay snack division recently said it would ask its corn growers not to use genetically modified seeds.

The Adrian Dominican Sisters, a group of 1,000 Catholic nuns based in Adrian, Mich., withdrew a proposal it had submitted to Dow Chemical after Dow agreed to a "good-faith dialogue" with the nuns.

U.S. companies faced 123 social-issue shareholder resolutions in 1999. None passed. In most, 6% to 8% of shareholders voted for the resolutions. "We know the votes rarely pass. (But) they're great for informing shareholders about an issue like genetic engineering," says Sara Newport of Friends of the Earth, a sponsor of the proposals. "They're tools for education."

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