International

Support grows for lobbying disclosures by companies

August 18, 2020

 

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In the 2020 proxy season, Mercy Investment Services and Interfaith Center on Corporate Responsibility (ICCR) members filed 30 shareholder resolutions asking companies to report on political expenditures and on federal and state lobbying spending, including indirect funding of lobbying through trade associations and nonprofit organizations, to ensure that this spending reflects the company’s values and policies. Twenty-one proposals received votes over 30%, up from 17 proposals in the 2019 proxy season; Chevron, Centene, and the Mercy-led filing at McKesson received majority votes. A new Chevron proposal, which received 53.5% support, requested the company report how its lobbying activities, including those done through trade associations, align with the goals of the Paris Agreement. Notably, BlackRock voted for this shareholder resolution; Mercy Investment Services engaged BlackRock this season, urging its support for climate-related resolutions.

The strong performance of these proposals indicates growing recognition that there is value in transparency and accountability of corporate spending in the public arena. For instance, as more companies adopt public policies or statements regarding their commitment to address climate change, they face reputational and even financial risks if their lobbying or political contribution activities are misaligned with those commitments. Additionally, in the current COVID-19 pandemic, investors want to understand how companies use federal assistance they received, their lobbying on public health and worker safety issues, and their processes to ensure accountability and manage risks associated with corporate spending. Mercy Investment Services will continue to monitor companies’ corporate spending to ensure the alignment of their spending with their stated commitments to protect the environment and communities.