Climate Lobbying – Seventh Generation Interfaith Coalition for Responsible Investing

SGI hosts a Lobbying Disclosure and Lobbying Alignment Webinar

February 21, 2023July 5, 2023Chris Cox

Companies invest billions of dollars in political influence through lobbying, campaign contributions, and other means. Corporations are societally chartered institutions of enormous importance and value, creating jobs, producing goods and services that consumers rely upon, impact the environment we live in and pay salaries to worker who hope to lead fulfilling lives. At the same time, corporations spend vastly greater sums on lobbying than the funds available to pro-consumer, pro-environment, and pro-worker organizations. Hence, we consider this an important, basic area of corporate governance, and adequate disclosure of corporate lobbying remains a pressing shareholder proposal topic.

SGI members filed or co-filed 12 proposals related to lobbying for the 2023 proxy season. Over the last few years, resolutions have moved from beyond basic disclosure to reporting on alignment and misalignment between a company’s stated position and the lobbying efforts that a company funds indirectly via trade associations, 501(c)(4) social welfare nonprofits, and 527 political organizations, often referred to as “dark money.” Those reports are important as the reveal the risks of lobbying misalignment.

To dig deeper into these themes, we hosted Tim Smith, senior policy advisor at ICCR, and John Keenan, Corporate Governance Analyst for Capital Strategies for the American Federation of State, County and Municipal Employees (AFSCME), for a webinar on Lobbying Disclosure and Lobbying Alignment.

The webinar also points investors to valuable resources concerning lobbying:

We are grateful for Tim Smith and John Keenan joining us. We want to thank all of our members and guests for attending our webinar.

Slides are available here. The video is available here.

Join SGI for a Webinar on Lobbing Disclosure and Alignment

February 8, 2023February 21, 2023Chris Cox

Join us for our first webinar of 2023 on Wednesday, February 15th, at 10:00 a.m. Central. We will address efforts for increased lobbying disclosure. Similar to previous years, SGI members filed or co-filed a dozen resolutions that pertain to lobbying disclosure and lobbying alignment. Joining us will be Tim Smith, newly returning to the ICCR staff, and John Keenan, of AFSCME. Register for the webinar here.

Why is this important? Visit any company’s website. Take a look at the company’s existing disclosures and assess:

Do they currently provide you with a clear idea of how and where the company is lobbying, to what end and with what efficacy, and how those activities are aligned with your interests?
Could you cite a number that represents how much the company has spent on influencing public policy, directly or indirectly, and with what partners, and on what issues?
Beyond its activities in the US, do you have a clear understanding of how the company attempts to impact policies in non-US jurisdictions?

Corporations are societally chartered institutions of enormous importance and value, creating jobs, producing goods and services that consumers rely upon, impact the environment we live in and pay salaries to worker who hope to lead fulfilling lives. At the same time, corporations spend vastly greater sums on lobbying than the funds available to pro-consumer, pro-environment, and pro-worker organizations. Hence, we consider this an important, basic area of corporate governance, and, in this webinar, we are going to dig into these engagements and resolutions.

Again, please, join us!

Walmart Hits a Double on Responsible Climate Lobbying Disclosure

April 11, 2022August 18, 2022Chris Cox

By Frank Sherman

“Climate change is one of the greatest challenges of our time, profoundly affecting all regions of the world and all sectors of society. . . . Companies need to be part of the solution to manage physical and transition risk, maintain societal license to operate and create value for business and society through mitigation and adaptation initiatives that draw on unique business capabilities.”
Walmart, 2021 ESG Summary

At first glance, this may be mistaken as an excerpt from an environmental NGO website rather than from the largest corporation in the world. But Walmart has long been recognized by many as a leader in climate action. They were the first retailer to obtain SBTi certified greenhouse gas (GHG) targets and the first to make a zero emissions commitment that does not rely on carbon offsets for scope 1 & 2 emissions. Committed to 100% renewable electricity by 2035, they have also been recognized as the top retail partner by the U.S. EPA Green Power Partnership. EPA’s SmartWay Excellence Award for shipping performance recognized Walmart for the fifth year in a row. Their award winning Project Gigaton targets a reduction of at least 30% of estimated scope 3 emissions by 2030. No wonder they made CDP Climate’s ‘A List’ for several years.

But one area where Walmart, along with many other companies, has fallen short is in its engagement on climate public policy. That’s why SGI member, the School Sisters of Notre Dame, Central Pacific Province (SSND), filed a shareholder resolution with the Company, as part of a broader campaign coordinated by ICCR and Ceres. According to Influence Map, Transition Pathways Initiative and Ceres, Walmart’s direct lobbying is supportive of the Paris Agreement. The SSND proposal asked Walmart to evaluate whether their indirect lobbying activities through trade associations and social welfare and nonprofit organizations are aligned with the company’s support of the Paris Agreement goals. We also asked the company to be more public in their support of robust climate policies rather than engaging policy makers ‘in private.’ The proponents withdrew the proposal after the Company agreed to improve their disclosure.

Following the withdrawal, Walmart strengthened their Government Relations Policy and made extensive updates to their Engagement in public policy webpage, providing details on governance, policy positions, engagement process, and examples of positive advocacy. They published a list of trade associations to which Walmart contributed funds of $25,000 or more in 2021. They actively engage their trade associations to influence their public policy positions. They note that the Business Roundtable’s (BRT) position towards climate policy, although not as strong as we would like, improved as a result of Walmart’s CEO Doug McMillon’s influence when he chaired the BRT.

To be fair, the goalpost on what constitutes “responsible climate lobbying” has been moving due to a number of factors including increasing calls from scientists for urgent action, such as the recent IPCC report. This culminated in the recently released Global Standard on Corporate Climate Lobbying describing 14 indicators to assess a company’s direct and indirect lobbying alignment with the Paris goal of limiting global temperature rise to 1.5 degrees.

To be sure, there are areas where Walmart’s disclosure and practices can be improved. The main shortfall vs. the new global standard is the lack of a detailed public assessment of each trade association’s climate policy positions and how well it aligns with the Paris goals and the Company’s position. An increasing number of multinational companies are doing this assessment of their indirect climate lobbying through trade associations and nonprofits they fund, evaluating the actions they are taking to support or undermine the Paris Agreement goal of 1.5 degrees. The Company states, “If a relationship—on balance—does not align with our priorities, we would end ties with the organization altogether,” which they did a few years ago when they exited the Chamber of Commerce. “I wouldn’t say they hit a homerun, but it’s safe to say they made it to second base,” said Tim Dewane, Director of Shalom – the Office of Justice, Peace, and Integrity of Creation for the School Sisters of Notre Dame, Central Pacific Province, the lead proponent of the resolution. “We have to continue to work to get them home.”