March 9, 2006 | Read Time: 2 minutes
A conservative advocacy group is pushing for passage of shareholder resolutions that would require some of the nation’s biggest corporations to report regularly on their charitable contributions and disclose the business rationale behind each grant.
The National Legal and Policy Center, in Alexandria, Va., has filed resolutions with four companies — Boeing, Citigroup, Coca Cola, and PepsiCo — and its president says the group probably will try to persuade more corporations to put the issue to a vote at their annual shareholders meetings.
Peter Flaherty, the center’s president, said PepsiCo is the only company that has resisted his organization’s effort to ask shareholders to consider the matter. The other three companies will let shareholders vote on the resolutions this spring.
Mr. Flaherty said his group is pushing for the votes because those companies have supported what he described as several left-leaning nonprofit groups, in particular Jesse Jackson’s Rainbow/PUSH and the Mexican American Legal Defense and Educational Fund. “If shareholders were aware of the corporate contributions to groups like Rainbow/PUSH and Maldef, the majority would object,” he said.
Elaine Palmer, a PespiCo spokeswoman, said the company agrees that it should make information about its charitable contributions more available to shareholders and the general public.
“We incorporated many of [the center’s] suggestions into information we’re putting on our Web site. We are in the process of providing very specific information about all of our grants, including the business rationale behind them, what the goals are, and how they are meeting those goals.”
The company has asked the Securities and Exchange Commission for permission to omit the resolution from the proxy statement sent to all shareholders for the annual meeting. Ms. Palmer said that is because “we feel we have substantially implemented the changes the center asked for. Putting a resolution into a proxy statement does have a cost. We feel this is not the best use of shareholders’ money.”
Mr. Flaherty says he still wants a vote at PepsiCo, because he thinks that is the best way to promote changes in giving policies. Mr. Flaherty said that his goal is not to stop all corporate gifts. “No one’s going to quarrel with Katrina relief,” he said. “But corporate America bankrolls the left. Corporate America does not support the advocates of the free market.”
