If nanotechnology goes astray, companies and their investors could face billions of dollars in asbestos-like litigation because potential risks are now

Illustration by Nanomatic

hidden due to weak regulations governing disclosure of liabilities.

The comments are in a report to be issued Wednesday by Investor Environmental Health Network, a partnership of investment managers concerned about the financial and public health risks associated with corporate toxic chemicals policies.

Nanoparticles are now commonly found in sunscreen, cosmetics, food, clothing, sporting goods and packaging.  Leading academic centers are pursuing thousands of other medical, consumer and commercial applications, some so science fiction-like they’re difficult to believe.

“Yet some of these technologies are showing signs of posing serious hazards to human health and the environment, including the same kind of grave threats resulting from exposure to asbestos,”  according to the report.

Three health studies have been done which do show some biological damage after exposure to nanoparticles, but the authors of all three stressed that their work is preliminary and much more needs to be done to quantify a degree of hazard to health.

Sanford Lewis, the report’s author and a lawyer for the network, says investors cannot afford the repetition of another asbestos-like wiping out of billions of dollars of equity when it comes to new technologies like nanotechnology.

He blames it on weak regulations and that companies “do not assess, quantify or disclose potential and pending liabilities on a timely basis.”

The report, he says, is a guide to how the Securities and Exchange Commission and the Financial Accounting Standards Board can close loopholes in dealing with these potentially hazardous products.

David Rejeski, director of the Project on Emerging Nanotechnologies at the Woodrow Wilson International Center for Scholars, gets to the heart of the matter in his comments on the report.

“While billions of dollars have been devoted to developing nanomaterials and introducing them into commerce, much less effort has been devoted to assessing their toxicity and developing governance systems for them,” he said.

Rejeski , also a former member of the White House Council on Environmental Quality, added that “a regulatory system that does not address the liabilities of existing nanotechnologies puts consumers, investors, shareholders, and the environment at risk and compromises the future promise of the technology.”

Here are a few facts from the report that I wanted to share, especially the last one:

– Companies will spend more than $1 trillion developing products based on nanotechnology by 2015.

– Currently, more than two million people work in the development, production, or use of nanomaterials.

– A recent European Agency for Safety and Health at Work report puts nanoparticles at the top of the list of substances from which workers need protection.

Here is a link if you want to see the full report.