More than four in 10 votes cast at AT&T’s recent shareholder meeting supported a proposal seeking disclosure about how the company’s political spending aligns – or does not align – with its stated positions on issues.
According to a regulatory filing, 44 percent of votes cast at the company’s AGM on May 19 supported the measure brought by As You Sow. Although not a majority, such levels of support are widely seen within the governance community as significant.
The resolution calls for AT&T to produce a report ‘analyzing the congruence of the company’s political and electioneering expenditures during the preceding year against publicly stated company values and policies, listing and explaining any instances of incongruent expenditures, and stating whether the company has made, or plans to make, changes in contributions or communications to candidates as a result of identified incongruencies.’
As You Sow recommends that the report include management’s analysis of risks to the company brand, reputation or shareholder value associated with expenditures that conflict with its publicly stated values. ‘AT&T’s politically focused expenditures appear to be misaligned with its public statements on company values, views and operational practices,’ As You Sow writes in its proposal materials.
It cites as an example: ‘AT&T states it: [h]as a ‘history of commitment to gender equality’, yet [the] proponent estimates that in the 2016 to 2018 election cycles, AT&T and its employee [political action committees (PACs)] made political donations totaling at least $16.4 mn to politicians and political organizations working to weaken women’s access to reproductive healthcare.’
‘EDUCATE POLICYMAKERS’
AT&T’s board had called for shareholders to vote against the proposal. ‘AT&T operates in highly regulated markets, and we believe it is in the stockholders’ best interests that we continue to be engaged in the political process to educate policymakers about issues that affect our core business,’ the board wrote in the 2022 proxy statement. ‘Further, in participating in the political process, we do so with best-practice-level accountability and disclosures – as evidenced by AT&T earning the highest possible score in the 2021 CPA-Zicklin Index.’
According to the board, AT&T participates in the political process in a bipartisan manner to support policies that ‘sustain and grow our business and create stockholder value. AT&T has a core set of critical business issues that drive political contributions and employee PAC contributions. Those core issues affect our ability to hire, pay good wages, provide world-class benefits, serve our customers, make capital investments, innovate to foster economic growth and return stockholder value.’
It argued that the company’s core business objectives and political giving align with its values. ‘When AT&T decides to weigh in on specific legislation, we take positions that are consistent with the company’s already-stated values and business priorities,’ the board wrote. ‘For example, two thirds of PAC contribution recipients supported the Dream Act, the Equality Act and the Paris climate change accords, consistent with AT&T’s values regarding safeguarding human rights and protecting our environment.’
The board acknowledges that in ‘the normal course of our political engagement’ it is possible AT&T will support some officials and some pieces of legislation that broadly contribute to its core businesses and values even if the company does not agree with every specific or stated position of each official.
An AT&T spokesperson declined to comment beyond the company’s proxy statement.
‘CROSS-PURPOSES’
As You Sow CEO Andrew Behar says in a statement following the vote: ‘We expect that AT&T will now take seriously the need to monitor, assess and report publicly on how it ensures the politicians and trade associations it supports are not working at cross-purposes with the company’s stated values and strategic goals.’
Meredith Benton, founder of consultancy Whistle Stop Capital and workplace equity program manager at As You Sow, formally presented the proposal to AT&T shareholders, according to the advocacy group. ‘It’s an incredible risk for AT&T to take, to be so deeply associated with anti-choice legislation,’ she says in a statement. ‘AT&T believes it needs to be involved in politics; we’re not arguing with that point. It is hard to see why, however, it is not managing the risks involved with supporting politicians who sit so clearly outside of its own company values.’
Ben Maiden
Ben Maiden is the editor-at-large of Governance Intelligence, an IR Media publication, having joined the company in December 2016. He is based in New York. Ben was previously managing editor of Compliance Reporter, covering regulatory and compliance...
