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February 02, 2013
Corporations Agree to Disclose Political Spending
    by Robert Kropp

The Center for Political Accountability announces that engagement has led to six corporations agreeing to adopt political disclosure and accountability, while a shareowner resolution at Visa gains significant support.

Last year, the Center for Political Accountability (CPA) announced that the number of public corporations agreeing to disclose their political expenditures had reached 100. More than half of the companies are listed on the S&P 100.

As reported here in late November, it now appears that the Securities and Exchange Commission (SEC) is considering a rule requiring that "public companies provide disclosure to shareholders regarding the uses of corporate resources for political activities," according to Paula Dubberly, a Deputy Director of the Division of Corporation Finance at the SEC. However, sustainable investors and other advocates are not simply waiting for a rule to materialize; CPA reports that more than 50 resolutions were filed with corporations this proxy season, requesting that they adopt political disclosure and board oversight.

It's also apparent companies themselves are acknowledging reality, as not only the number of resolutions but the vote totals as well continue to rise. At Visa's annual general meeting this week, for instance, 37% of shareowners votes in support of a resolution requesting that the financial services company disclose all payments used for lobbying purposes, including payments to trade associations.

The resolution, co-filed by Boston Common Asset Management and the Unitarian Universalist Association (UUA), stated, "Public opinion is skeptical of corporate influence on Congress and public policy and questionable lobbying activity may pose risks to our company's reputation when controversial positions are embraced."

At Visa's annual meeting, Meredith Benton of Boston Common said, "We commend Visa for initiating enhanced disclosure."

"We persist, though, in bringing this proposal to ballot as the company has not yet contemplated any disclosure to shareholders on lobbying spending connected with trade associations or other tax exempt organizations," Benton continued.

Also this week, CPA announced that six corporations avoided having resolutions on political spending come to a vote by agreeing to adopt disclosure and accountability. Boeing and Mylan, a pharmaceutical company, came to agreement after resolutions during last year's proxy season gained significant support. KeyCorp, Harley-Davidson, Deere & Co., and AmerisourceBergen also agreed to disclosure of political expenditures.

"The companies have agreed to disclose their direct corporate political contributions, indirect political spending through trade associations and other groups such as 'social welfare' 501(c)(4)s and to implement board oversight," CPA stated.

The withdrawn resolutions, which were based on the CPA model, were filed by Investor Voice, the New York State Common Retirement Fund, the Nathan Cummings Foundation, the International Brotherhood of Teamsters General Fund, and William Zessar.

"Hidden political spending soared off the charts in the 2012 elections, but a steadily increasing number of American companies are choosing an alternative, the Center's model for disclosure and board oversight of corporate political spending," said CPA President Bruce Freed.


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