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Pressure mounts on James Hardie -

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Broadcast: 22/09/2004

Pressure mounts on James Hardie

Reporter: Karen Tso

CHRIS CLARK: Enormous pressure is mounting on James Hardie, with corporate regulator ASIC to
investigate the company and its directors after yesterday's damning report.

Meanwhile, State governments are threatening a national ban on James Hardie products unless it does
the right thing by asbestos victims.

Tonight, the Liberal Party has also agreed to join Labor in handing back donations received from
James Hardie.

Here's our finance reporter, Karen Tso.

KAREN TSO: James Hardie's reputation is tainted after yesterday's report condemning its actions in
setting up the cheapest marketable compensation fund for its asbestos liabilities.

It's money is a currency no longer accepted by any political party.

The Liberals were under pressure earlier to follow Labor's lead and reject the company's funds.

GREG COMBET, ACTU SECRETARY: Mr Howard should do what Mr Latham has done and hand back the dirty
money that James Hardie donated to the Liberal Party in recent years.

KAREN TSO: And tonight, the PM confirmed the money will be given back.

JOHN HOWARD, PM: Yes.

I've had a look at it.

Discussed it with the party organisation, I had a further discussion with them this afternoon, and
we want to be absolutely certain that it goes to the victims.

KAREN TSO: James Hardie has gone avoided any detailed public statement in response to the
commission's report.

Its no doubt considering its legal position and that of its senior executives.

After the Australian Securities and Investments Commission officially launched an investigation.

JEFFREY LUCY: ASIC is deeply concerned about the serious corporate governance issues that have been
raised by Mr Jackson QC and the community can be assured that we will vigorously pursue breaches of
the law.

KAREN TSO: Breaches highlighted in the Jackson report could invoke hefty fines, jail terms and bans
for company directors.

ASIC may also look beyond the commission's recommendations.

Meanwhile, the NSW Government is taking matter into its own hands, leading a national boycott to
pressure James Hardie.

BOB CARR, NSW PREMIER: I can announce that Queensland and Victoria have agreed in principle to the
boycott of James Hardie products if James Hardie doesn't commit itself to negotiations with the
victims.

KAREN TSO: The Jackson report has highlighted deficiencies in the corporations law which unions
want fixed.

Although business groups have warned against a knee-jerk reaction?

GREG COMBET: There has to be a capacity for people like victims to be able to pierce the corporate
veil and reach out to the parent company and to seek proper redress.

JOHN HOWARD: If there are changes to the law, that are needed, those changes will be made.

MARK LATHAM, OPPOSITION LEADER: If we can also change the law in a way that helps in the instance
of James Hardie we'll do that as well.

KAREN TSO: The question of how compensation should be paid continues to divide stakeholders.

Unions say a statuary scheme is dead in the water but the man in charge of the James Hardie
compensation fund says its the best option.

SIR LLEW EDWARDS, MEDICAL RESEARCH AND COMPENSATION FUND: I say this publicly, which won't make my
lawyer friends happy - we've got to get the expense of litigation process out of the system.

KAREN TSO: James Hardie will be happy with his remarks, it continues to argue the same point.

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