Corporate Political Activity - Election Spending

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The Center for Political Accountability and its allies, a wide variety of institutional investors, are continuing the campaign they began in 2003. The standard CPA proposal, which has not been changed for several years, asks 27 companies to produce a report, with semiannual updates, on:

  1. Policies and procedures for making, with corporate funds or assets, contributions and expenditures (direct and indirect) to (a) participate or intervene in any political campaign on behalf of (or in opposition to) any candidate for public office, or (b) influence the general public, or any segment thereof, with respect to an election or referendum.
  2. Monetary and non-monetary contributions and expenditures (direct and indirect) used in the manner described in section 1 above, including:
    a. The identity of the recipient as well as the amount paid to each; and
    b. The title(s) of the person(s) in the Company responsible for decision-making.

Fourteen of the resolutions are resubmissions (one is not public) and the 13 others are at new recipients. (See table for the full list.) Twenty-two were pending as of mid-February.

So far there has been just one vote, 40.3 percent at Emerson Electric, up from 31.4 percent last year but still below its high mark from 2014 of 47.3 percent. The proposal notes the company fared poorly on the CPA-Zicklin index.

SEC action:
Ford Motor unsuccessfully challenged the resolution at the SEC, which disagreed with the company’s contention it duplicated a proposal received first about lobbying. The company said the proposals are similar because each mentions trade association spending—although the proponent of the election spending resolution did not do so in the resolved clause and also stipulated lobbying was not encompassed in his proposal.

NYSCRF withdrew at General Electric, after the company argued that it substantially duplicated a proposal about lobbying that it received first from the National Center on Public Policy Research, a conservative political group. NYSCRF withdrew before any SEC response. (A similar pre-emption occurred with the standard lobbying proposal at Duke Energy, as noted above). But in GE’s case, the company argued the NYSCRF election spending proposal was duplicated by NCPPR’s lobbying resolution because trade associations, mentioned in the resolution, both lobby and spend on elections. Last year, at Exxon Mobil, the SEC agreed with this line of reasoning. 

Xcel Energy told the SEC the resolution is moot and that its policies and reporting already address the proposal’s concerns. The SEC had not yet responded when the Nathan Cummings Foundation withdrew the resolution, announcing an agreement on implementation.

Withdrawal agreements:
NYSCRF has withdrawn at Mattel, after reaching an agreement.

Advocacy Position: Shareholders Paying Closer Attention to Corporate Electoral Spending