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Be aware the botched executions’ effect

Home / Hermes EOS Blog / Be aware the botched executions’ effect

Tim Goodman,
11 February 2015
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Reputational risk
Many pharmaceutical companies have acknowledged the reputational risk associated with supplying medicines to the US penal system for use in administering lethal injections to perform capital punishment. To mitigate the risk and prevent the supply of their drugs to the US penal system, they have put in place distribution controls. This is supported by EU law that prevents export of these drugs for such purposes.

As a result of the industry establishing such distribution controls, some US states have halted – albeit temporarily – capital punishment, while others have sought to use compounded rather than manufactured drugs. A third category has started to use experimental drug cocktails to execute the death penalty.

The latter activity has led to a series of botched executions. As these executions can be horrific in nature, they leave the manufacturers of the drugs open to reputational and legal risk as well as the possibility of divestment from asset owners.

Unwitting participation
However, not all companies have taken action yet to prevent the use of their drugs in US executions.

Research has indicated that a few companies supply drugs used in the experimental cocktails because they have not set up effective restricted distribution systems.

One company has put a restricted distribution system in place for propofol which appears to be working. However, it has not done the same for hydromorphone, which was used in a botched execution in Ohio. Another one has failed to implement restricted distribution systems for either hydromorphone or midazolam, drugs which are named in the execution protocols in a number of US states. Similarly, rocuronium bromide – produced by a third manufacturer – is used as a paralytic agent and also listed in the execution protocols of some US states.

A fourth company meanwhile has limited restrictions on the distribution of mizadolam, vecuronium bromide and rocuronium bromide. However, the controls, which do not stop sales to the US penal system from retail or compounding pharmacies, are insufficient to stop the use of these drugs in lethal injections in a number of US states which record one or more of them in their execution protocols.

What we have done
One of the pharmaceutical companies implicated in US executions is part of our core-engagement programme and we have a specific engagement objective for it to implement distribution controls to prevent the use of its drugs to administer capital punishment.

We have also contacted the CEOs of three other companies highlighting our concerns on this issue.

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Tim Goodman Tim Goodman is a director at Hermes EOS and sector lead for oil and gas. He is also responsible for Hermes EOS’ activities in North America. Previously, he worked in the insurance industry and held a number of senior operational management roles before acting as a company secretary in a UK-listed company. He is a member of the Institute of Chartered Secretaries and Administrators, having obtained the institute prize for the best overall performance when he qualified. Tim is a regular speaker on governance-related matters, a member of the US Council of Institutional Investors’ corporate governance advisory council and a former chair of the UK Quoted Companies Alliance corporate governance committee.
Read all articles by Tim Goodman

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