PASADENA, CALIF.—An industry-funded research institute that pledges to be independent of the companies that are funding it is the latest player in the debate on, the environmental and public health risk of toxic chemicals.

The Institute for Evaluating Health Risks (IEHR) says it is the nation’s first independent institute formed to specifically address environment-related health risks. It was put together by ethicist Charles Powers, a former philosophy professor at Yale University, who has started two other organizations for evaluating environmental problems.

IEHR’s origins lie in a 1986 California law known as Proposition 65, which bars industry from releasing toxic substances into waterways and requires industry to warn consumers of the levels of toxic chemicals contained in products. Exempt from the law are substances that have been shown to pose no significant risk, a formidable challenge for any manufacturing company.

This fall the institute moved into an office at the National...

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