The pressure on corporations to disclose political and lobbying activities spiked after the 2010 Supreme Court decision in Citizens United v. Federal Election Commission, which permitted companies to contribute directly to political groups.
The danger to corporations was evident in the past two weeks as activists pressed a dozen firms to cut their financial support for a little-known but effective conservative lobbying group, the American Legislative Exchange Council. The group focuses on state legislative issues, including promoting “stand your ground” laws, which gained national attention after the fatal shooting of 17-year-old Trayvon Martin in Florida.
After Martin’s death, activists targeted companies with memberships in ALEC, asking them to sever ties to the group. Several firms, including Coca-Cola, Pepsi, McDonald’s and Intuit, announced that they would not renew their memberships. Binns, WellPoint’s spokesperson, said the company has not participated in ALEC this year.
Most shareholder and boycott efforts are less successful. Binns noted that a shareholder resolution two years ago asking WellPoint to provide more disclosure was defeated by 82 percent of voters.
On the other hand, a growing number of major companies have adopted rules for disclosure and oversight of their political spending. Currently, 96 firms in the S&P 500 have committed to disclosure and oversight, according to a study by the Center for Political Accountability. The tactic of holding individual board members to account may add fuel to the overall effort at a time when shareholder resolutions are having some success.
On Tuesday, 55 percent of Citigroup’s shareholders supported a resolution at the company’s annual meeting opposing the pay packages offered to top executives.
In a letter that is set to be mailed Thursday to WellPoint shareholders, the investors’ coalition urged opposition to the two board members as a way of holding them responsible for governance decisions.
“These directors must be held accountable for WellPoint’s refusal . . . to disclose the details of its high risk political spending,” the coalition said in the letter.