Lobbying Disclosure – UnitedHealth Group (2012)
Resolved: Shareholders of UnitedHealth Group (“UNH” or the “Company”) request that the Board of Directors (the “Board”) authorize the preparation of a report, updated annually, disclosing:
1. Company policy and procedures governing the lobbying of legislators and regulators, including that done on the Company’s behalf by trade organizations. The disclosure should include both direct and indirect lobbying and grassroots lobbying communications.
2. A listing of payments (both direct and indirect, including payments to trade organizations) used for direct lobbying as well as grassroots lobbying communications, including the amount of the payment and the recipient.
3. Membership in and payments to any tax-exempt organization that writes and endorses model legislation.
4. Description of the decision making process and oversight by the management and the Board for (a) direct and indirect lobbying contribution or expenditure; and (b) payment for grassroots lobbying expenditure.
For purposes of this proposal, a “grassroots lobbying communication” is a communication directed to the general public that: (a) refers to specific legislation, (b) reflects a view on the legislation and (c) encourages the recipient of the communication to take action with respect to the legislation. Both “direct and indirect lobbying” and “grassroots lobbying communications” include efforts at the local, state and federal levels. The report shall be presented to the Audit Committee or other relevant oversight committee of the Board and posted on the Company’s website.
Supporting Statement
Under the U.S. Supreme Court’s decision in Citizens United v. Federal Election Commission, corporations are considered persons having the right to express opinions on public policy issues. However, corporations can exert significantly greater influence than single individuals or groups and may promote interests unknown and contrary to the interests of their own shareholders.
For example, many companies in the health care industry have told their shareholders they are in basic support of the federal health reform law known as the Affordable Care Act, albeit with a desire for necessary changes. However, many of these corporations are members of groups such as the U.S. Chamber of Commerce, the American Legislative Exchange Council (“ALEC”) and other organizations which are actively working to eliminate the Affordable Care Act.
It is important that our Company’s lobbying positions, as well as processes to influence public policy, are transparent. Public opinion is skeptical of corporate influence on Congress and public policy. Questionable lobbying activity may pose risks to our Company’s reputation when controversial positions are embraced. Hence, we believe full disclosure of UNH’s policies, procedures and oversight mechanisms is warranted.
UNH has spent nearly $23 million from 2008 through Q1 2011 on direct federal lobbying activities, according to public records. These figures may not include its grassroots lobbying to directly influence legislation by mobilizing public support or opposition. Also, not all states require disclosure of lobbying expenditures to influence legislation or regulation and UNH does not disclose contributions to tax-exempt organizations that write and endorse model legislation, such as a $50,000 contribution to ALEC’s 2011 annual meeting (http://thinkprogress.org/politics/2011/08/05/288823/alec-exposed-corporations-funding/).
Network Neutrality On Wireless Networks – Verizon (2012)
WHEREAS:
The open (non-discriminatory) architecture of the Internet is critical to the prosperity of our economy and society. Non-discrimination principles are commonly referred to as “network neutrality” and seek to ensure equal access and non-discriminatory treatment for all content.
As President Obama and Federal Communication Commission Chairman Genachowski have pointed out, an open Internet plays a pivotal role in solving critical national problems such as healthcare, education, energy, and public safety and is necessary “to preserve the freedom and openness that have allowed the Internet to become a transformative and powerful platform for speech and expression.”
Network neutrality rules are also needed to “facilitate the growth of the Internet and give private companies the correct incentives to continue investing in this significantly valuable good,” according to a January 2010 report by the Institute for Policy Integrity at New York University. This report and others find that an open Internet accounts for billions of dollars of value for the economy.
We believe this economic and social value is an important factor in the growth of our economy and widely diversified investment portfolios.
Open Internet policies on wireless networks (the fastest growing segment of the Internet) have particular importance for minority and economically disadvantaged communities. People of color access the Internet via cell phones at a much greater rate than their white counterparts, according to a report by the Pew Internet & American Life Project. In 2010, the report found, 33% of whites accessed the Internet on cell phones compared to 51% of Latinos and 46% of African-Americans; 30% of whites sent or received e-mail on cell phones compared to 47% of Latinos and 41% of African-Americans.
In 2011 Pew reported “Smartphone owners under the age of 30, non-white smartphone users, and smartphone owners with relatively low income and education levels are particularly likely to say that they mostly go online using their phones.” It found that almost a third of the “mostly cell” users lack any traditional broadband Internet access. The author of the report concluded, “For businesses, government agencies and nonprofits who want to engage with certain communities, they will find them in front of a four-inch screen, not in front of a big computer in their den.”
According to Colorofchange.org, an organization representing African-Americans, “The digital freedoms at stake are a 21st century civil rights issue.”
For all these reasons, we believe network neutrality on wireless networks is needed to protect open access to the Internet by millions of Americans.
Resolved, shareholders request the company publicly commit (while not conceding or forfeiting any issue in litigation related to network neutrality) to operate voluntarily its wireless broadband network consistent with network neutrality principles – i.e., operate a neutral network with neutral routing along the company’s wireless infrastructure such that the company does not privilege, degrade or prioritize any packet transmitted over its wireless infrastructure based on its source, ownership or destination.
Sustainable Palm Oil Policy – YUM! Brands, Inc. (2012)
Whereas:
The environmental and social impacts of palm oil, an ingredient in our Company’s supply chain, make it highly controversial. Accordingly, we believe the Company’s failure to procure certified sustainable palm oil is a brand risk, to both our Company’s reputation and long-term to the security of supply.
Approximately 85% of palm oil is grown in Indonesia and Malaysia, much of it on industrial plantations. According to the Union of Concerned Scientists, palm oil plantations are a large source of greenhouse gas emissions (GHGs) because they are often established on land converted from swamp forests (“The Root of the Problem: What’s Driving Deforestation Today, Ucsusa.org, June 2011).
Due to high levels of continuing deforestation and the burning of peatlands in land clearance, Indonesia is now the 3rd largest emitter of GHGs globally. A 2010 report commissioned by Indonesia’s National Development Planning Agency found that the conversion of peatlands alone accounts for 50 percent of Indonesia’s GHG emissions but only 1% of GDP. (“Indonesian Government Report Recommends Moratorium on Peatlands Conversion,” Mongabay, January 19, 2010) Agricultural expansion, much of it for palm oil production, can be better managed by using other land types than standing forest.
Palm oil plantations that are not sustainably managed have been shown to destroy habitats of endangered species, such as the orangutan (UNEP-WCMC.org). Consumers have demonstrated concern for orangutan welfare by campaigning against companies that have failed to source sustainable palm oil. Failure to manage the reputational risk of deforestation in supply chains has been disruptive for a number of high profile brands including Mattel and Nestle.
The Roundtable for Sustainable Palm Oil was formed in 2004 to address the social and environmental concerns associated with palm oil production and promote sustainable palm oil products. Leading companies have committed to source only certified sustainable palm oil by 2015, including SC Johnson, Wal-Mart, General Mills, McDonalds, Mars, Nestle and Unilever. Our company has not made such a commitment and we believe has not addressed the risks described above.
RESOLVED: Shareholders request that the board of directors adopt and implement a comprehensive sustainable palm oil policy.
Supporting Statement: We believe that in order to effectively address this issue, the Company should adopt a policy that includes:
- a target date for sourcing 100% Certified Sustainable Palm Oil or for purchasing GreenPalm certificates covering 100% of sourced palm oil,
- plans to verify suppliers’ compliance with the policy,
- supporting a moratorium on palm oil expansion in rainforests and peatlands, and
- a commitment to disclose the company’s progress on this issue.
Executive Compensation – JPMorgan Chase & Co. (2012)
WHEREAS:
Income inequality is a growing problem in the United States. According to the U.S. Census Bureau, in 2010, 46.2 million Americans lived in poverty—including more than 1 out of every 5 American children. (http://www.census.gov/hhes/www/poverty/data/ incpovhlth/2010/highlights.html) Many in America’s once robust middle class are now struggling to make ends meet.
While the bottom 99 percent of Americans face increasingly tough times, the share of income going to the top 1 percent, especially the top 0.1 percent, continues to grow. An October 2011 report from the Congressional Budget Office found that in 1979, the top 1 percent received about the same share of income as the bottom 20 percent; in 2007 the top 1 percent received more income than the bottom 40 percent combined. (http://www.cbo.gov/ doc.cfm?index=12485) According to the economist Joseph Stiglitz, the richest 1 percent of Americans now takes in nearly a quarter of our nation’s income. (http://www.vanityfair.com/society/features/2011/05/top-one-percent-201105)
The compensation packages of Chief Executive Officers and other senior executives play a significant part in the growing income inequality in the United States. A 2010 working paper by professors at Williams College and Indiana University, entitled “Jobs and Income Growth of Top Earners and the Causes of Changing Income Inequality”, found that executives, managers, supervisors, and financial professionals account for about 60 percent of the top 0.1 percent of income earners in recent years, and about 70 percent of the increase in the share of national income going to the top 0.1 percent. (http://ideas.repec.org/p/wil/wileco/2010-24.html)
Growing income inequality and the level of senior executive compensation at JPMorgan Chase & Co.—the Company’s Chief Executive Officer was given $20.8 million in total compensation for 2010, roughly 420 times the real median household income in 2010—combined with its perceived role in the 2008 financial crisis, has focused public ire on the Company. (http://www.census.gov/newsroom/releases/archives/income_wealth/ cb11-157.html) The Occupy movement, with its focus on the inequalities between the extreme wealth of the top 1 percent and the struggles of the other 99 percent of society, held demonstrations outside of our Company’s offices. Our Company has also been a primary focus of the Move Your Money project, a campaign that aims to encourage divestment from Wall Street banks. (http://moveyourmoneyproject.org/our-story)
A Watson Wyatt survey conducted before the 2008 financial crisis found that 85 percent of institutional investors believed that the prevalent executive compensation system in the United States was damaging to Corporate America’s image. A separate Watson Wyatt survey of 50 directors serving on corporate boards found that 61 percent believed that most executives were dramatically overpaid and 79 percent believed the executive pay model had damaged Corporate America’s image. (http://www.watsonwyatt.com/render.asp?catid=1&id=16180)
RESOLVED: Shareholders request that a committee of independent directors of the Board assess how the Company is responding to risks, including reputational risks, associated with the high levels of senior executive compensation at our firm and report to shareholders (at reasonable cost and omitting proprietary information) by December 31, 2012.v
Equal Employment Opportunity (EEO) – Home Depot (2012)
WHEREAS: Equal employment opportunity (EEO) is a fair employment practice and an investment issue. We believe that companies with a good EEO record have a competitive advantage in recruiting/retaining employees. We believe Home Depot customers are increasingly diverse; therefore a similarly diverse work force is more likely to anticipate and respond effectively to consumer demand. EEO reporting has economic relevance.
Home Depot shareholder votes in favor of a Diversity Report surpassed 23%, 26%, 22%, and 25% in 2011, 2010, 2009 and 2008 respectively – sending a consistent signal to management that shareowners desire increased accountability.
The Company annually files an EEO-1 report with the Equal Employment Opportunity Commission. This information could be made available to shareholders at a minimal additional cost.
Allegations of discrimination in the workplace burden shareholders with costly litigation that can damage a company’s reputation.
Home Depot has paid out more than $100 million to settle discrimination lawsuits in the last 15 years. The most significant EEOC settlement of $87 million was in 1997. In 2004, Home Depot agreed to pay $5.5 million to settle charges of class-wide gender, race and national origin discrimination at more than 30 Colorado stores. In 2009, Home Depot paid $84,750 to settle retaliation charges related to a 2004 discrimination suit.
RESOLVED: The shareholders request that Home Depot prepare a diversity report, at reasonable cost and omitting confidential information, available to investors by September 2012, including the following:
1. A chart identifying employees according to their gender and race in each of the nine major EEOC-defined job categories for the last three years, listing numbers or percentages in each category;
2. A summary description of any affirmative action policies and programs to improve performance, including job categories where women and minorities are underutilized;
3. A description of any policies and programs oriented specifically toward increasing the number of managers who are qualified females or minorities.
Supporting Statement: In 2009, the U.S. Equal Employment Opportunity Commission reported racial minorities comprised 34% of the private industry workforce, but just 11% of executives and managers. Likewise,women represented 48% of the workforce, but just 28% of executives and managers. Employment and advancement barriers persist.
Several major U.S. corporations provide diversity reports with detailed EEO information including Walmart, Hewlett Packard, Nike, Costco and Intel.
In 2001, Home Depot began providing EEO information to investors upon request. Since then, Home Depot reversed its policy on disclosure of this information.
We agree with a recommendation of the 1995 bipartisan Glass Ceiling Commission that “public disclosure of diversity data—specifically data on the most senior positions—is an effective incentive to develop and maintain innovative, effective programs to break the glass ceiling barriers.” Home Depot has demonstrated leadership on many corporate social responsibility issues. We ask the company to again demonstrate leadership in diversity by committing to EEO disclosure.
Canadian Oil Sands – ExxonMobil (2012)
WHEREAS:
ExxonMobil has significant investments in the Canadian oil sands.
ExxonMobil owns 69.6 percent of Imperial Oil, one of Canada’s largest oil companies. Imperial is 100 percent owner of the Cold Lake oil sands project and is the operator and 25 percent owner of Syncrude. ExxonMobil and Imperial jointly own and operate 100 percent of the Kearl oil sands project.
According to ExxonMobil’s 2010 10-K, oil sands represent approximately 11 percent of proved reserves, demonstrating our company’s significant reliance on Canada’s oil sands for long term growth.
There are significant environmental, social and economic risks associated with oil sands.
The resource-intensive and environmentally damaging nature of oil sands development have introduced regulatory, operational, liability and reputational risks to oil sands companies.
The persistence of tailing ponds, which can leak toxic pollutants into groundwater, may present risks along with significant reclamation costs not currently carried on our balance sheet. While companies are required to provide reclamation costs to the Alberta government, investors still have very limited information on the full costs associated with the reclamation liabilities companies carry.
Lawsuits filed by Aboriginal peoples against the Canadian government challenge oil sands and pipeline projects even after approval. One thousand five hundred project components related to ExxonMobil are included in the Beaver Lake Cree case, one of the high-profile cases which could potentially shut down oil sands operations.
Developing the oil sands’ tar-like bitumen is expensive, with multi-decade payback horizons. Volatile oil prices and changing demand can impact the viability of these projects.
In its 2010 10-K, Nexen, another company in the oil sands, states, “[o]ur oil sands projects face additional risks compared to conventional oil and gas production,” and references risks related to “Aboriginal claims” and “Public perception of oil sands development.”
Shareholders believe ExxonMobil has not adequately reported on how possible risks associated with oil sands projects may impact our company’s long term financial performance, given our company’s significant investments in this area.
RESOLVED:
Shareholders request that the Board prepare a report discussing possible short and long term risks to the company’s finances and operations posed by the environmental, social and economic challenges associated with the oil sands. The report should be prepared at reasonable cost, omit proprietary and legal strategy information, address risks other than those associated with or attributable to climate change, and be available to investors by August 2012.
SUPPORTING STATEMENT:
The Board shall determine the scope of the report. Proponents believe risk information of interest to shareholders could include, among other things, assessing the impact of worst-case along with reasonably likely scenarios regarding:
- Environmentally-related restrictions and requirements that might hinder or penalize operations, including those associated with water, land, non-carbon air emissions, reclamation and tailings;
- Aboriginal lawsuits against the Canadian government; and
- Public opposition throughout the lifecycle of oil sands operations –from exploration, to extraction, to transportation of the extracted bitumen.
Sexual Orientation Non-Discrimination Policy – ExxonMobil (2012)
Whereas: ExxonMobil does not explicitly prohibit discrimination based on sexual orientation and gender identity in its written employment policy;
Over 89% of the Fortune 500 companies have adopted written nondiscrimination policies prohibiting harassment and discrimination on the basis of sexual orientation, as have more than 95% of Fortune 100 companies, according to the Human Rights Campaign. Nearly 70% of the Fortune 100 and 43% of the Fortune 500 now prohibit discrimination based on gender identity or expression;
We believe that corporations that prohibit discrimination on the basis of sexual orientation and gender identity have a competitive advantage in recruiting and retaining employees from the widest talent pool;
According to an October, 2009 survey by Harris Interactive and Witeck-Combs, 44% of gay and lesbian workers in the United States reported an experience with some form of job discrimination related to sexual orientation; an earlier survey found that almost one out of every 10 gay or lesbian adults also stated that they had been fired or dismissed unfairly from a previous job, or pressured to quit a job because of their sexual orientation;
Twenty-one states, the District of Columbia and more than 160 cities and counties, have laws prohibiting employment discrimination based on sexual orientation; 12 states and the District of Columbia have laws prohibiting employment discrimination based on sexual orientation and gender identity;
Minneapolis, San Francisco, Seattle and Los Angeles have adopted legislation restricting business with companies that do not guarantee equal treatment for gay and lesbian employees;
Our company has operations in, and makes sales to institutions in states and cities that prohibit discrimination on the basis of sexual orientation;
National public opinion polls consistently find more than three quarters of the American people support equal rights in the workplace for gay men, lesbians and bisexuals; for example, in a Gallup poll conducted in May 2009, 89% of respondents favored equal opportunity in employment for gays and lesbians;
Resolved: The Shareholders request that ExxonMobil amend its written equal employment opportunity policy to explicitly prohibit discrimination based on sexual orientation and gender identity and to substantially implement the policy.
Supporting Statement: Employment discrimination on the basis of sexual orientation and gender identity diminishes employee morale and productivity. Because state and local laws are inconsistent with respect to employment discrimination, our company would benefit from a consistent, corporate wide policy to enhance efforts to prevent discrimination, resolve complaints internally, and ensure a respectful and supportive atmosphere for all employees. ExxonMobil will enhance its competitive edge by joining the growing ranks of companies guaranteeing equal opportunity for all employees.
Disclosure of Direct and Indirect Political Spending -State Street Corp (2012)
Resolved, that the shareholders of State Street Corporation (“Company”) hereby request that the Company provide a report, updated semi-annually, disclosing the Company’s:
1. Policies and procedures for political contributions and expenditures (both direct and indirect) made with corporate funds.
2. Monetary and non-monetary contributions and expenditures (direct and indirect) used to participate or intervene in any political campaign on behalf of (or in opposition to) any candidate for public office, and used in any attempt to influence the general public, or segments thereof, with respect to elections or referenda. The report shall include:
a. An accounting through an itemized report that includes the identity of the recipient as well as the amount paid to each recipient of the Company’s funds that are used for political contributions or expenditures as described above; and
b. The title(s) of the person(s) in the Company responsible for the decision(s) to make the political contributions or expenditures.
The report shall be presented to the board of directors or relevant oversight committee and posted on the company’s website.
Stockholder Supporting Statement
As long-term shareholders of State Street, we support transparency and accountability in corporate spending on political activities. These include any activities considered intervention in any political campaign under the Internal Revenue Code, such as direct and indirect political contributions to candidates, political parties, or political organizations; independent expenditures; or electioneering communications on behalf of federal, state or local candidates.
Disclosure is consistent with public policy, in the best interest of the company and its shareholders, and critical for compliance with federal ethics laws. Moreover, the Supreme Court’s Citizens United decision recognized the importance of political spending disclosure for shareholders when it said “[D]isclosure permits citizens and shareholders to react to the speech of corporate entities in a proper way. This transparency enables the electorate to make informed decisions and give proper weight to different speakers and messages.” Gaps in transparency and accountability may expose the company to reputational and business risks that could threaten long-term shareholder value.
Relying on publicly available data does not provide a complete picture of the Company’s political spending. For example, the Company’s payments to trade associations used for political activities are undisclosed and unknown. In some cases, even management does not know how trade associations use their company’s money politically. The proposal asks the Company to disclose all of its political spending, including payments to trade associations and other tax exempt organizations used for political purposes. This would bring our Company in line with a growing number of leading companies, including Prudential, US Bancorp and Wells Fargo that support political disclosure and accountability and present this information on their websites.
The Company’s Board and its shareholders need comprehensive disclosure to be able to fully evaluate the political use of corporate assets. We urge your support for this critical governance reform.
Report on Domestic Partner Benefits for Senior Executives – Aflac (2012)
WHEREAS:
Costs associated with senior executive turnover are significant and far-reaching. Replacement costs to a company can reach up to 250% of an executive’s annual salary.
The proponents believe that companies who choose not to discriminate in the extension of benefits gain a competitive edge in executive recruitment and retention. The equal provision of benefits sends a message of respect and inclusion, and conveys a tangible commitment to the principle that equal work deserves equal pay.
If Aflac extends domestic partner benefits to its executives (or employees), this policy is not publicly accessible. Companies in the insurance industry that do have domestic partner policies include Aetna, AIG, Chubb, The Hartford, ING North America, MetLife, Nationwide, Unum, State Farm and others.
Eighty-three percent of the Fortune 100 provided domestic partner benefits to employees in 2011, up from 64% in 2004. A growing proportion of the Fortune 500 also provided them in 2011 (58%, from 40% in 2004). According to a 2005 Hewitt Associates study, 64% of companies who offered domestic partner benefits to same-sex partners found that related expenses rose no more than 1 percent; 88% experienced financial impacts of 2% or less, and only 5% saw costs rise 3% or greater. (See http://www.hrc.org/resources/entry/domestic-partner-benefits-cost-and-utilization.)
RESOLVED: Shareholders request that the company report to shareholders within six months, at reasonable cost and excluding confidential information, on its policies and practices for providing domestic partner benefits as a part of its senior executive compensation packages.
SUPPORTING STATEMENT:
Family-friendly benefits have become an important element of company strategies to address issues of work-life balance and recruitment and retention. We believe that companies offering family-friendly benefits profit from a more positive public image, and from factors such as increased recruitment and retention, improved productivity and morale, and improved quality of work-life that leads to reduced absenteeism, turnover, and stress.
The report should address the extension of same-sex domestic partner benefits to senior executives in the following areas:
- Health benefits (medical, dental, vision, dependent coverage and COBRA benefits continuation)
- Retirement benefits (such as healthcare, pension plans and 401k’s)
- Benefits that extend to married couples such as bereavement leave, relocation/travel assistance, education and tuition assistance, adoption assistance, credit union membership, disability and life insurance, and employee discounts
Network Neutrality On Wireless Networks – AT&T (2012)
Whereas:
The open (non-discriminatory) architecture of the Internet is critical to the prosperity of our economy and society. Non-discrimination principles are commonly referred to as “network neutrality” and seek to ensure equal access and non-discriminatory treatment for all content.
As President Obama and Federal Communication Commission Chairman Genachowski have pointed out, an open Internet plays a pivotal role in solving critical national problems such as healthcare, education, energy, and public safety and is necessary “to preserve the freedom and openness that have allowed the Internet to become a transformative and powerful platform for speech and expression.”
Network neutrality rules are also needed to “facilitate the growth of the Internet and give private companies the correct incentives to continue investing in this significantly valuable good,” according to a January 2010 report by the Institute for Policy Integrity at New York University. This report and others find that an open Internet accounts for billions of dollars of value for the economy.
We believe this economic and social value is an important factor in the growth of our economy and widely diversified investment portfolios.
Open Internet policies on wireless networks (the fastest growing segment of the Internet) have particular importance for minority and economically disadvantaged communities. People of color access the Internet via cell phones at a much greater rate than their white counterparts, according to a report by the Pew Internet & American Life Project. In 2010, the report found, 33% of whites accessed the Internet on cell phones compared to 51% of Latinos and 46% of African-Americans; 30% of whites sent or received e-mail on cell phones compared to 47% of Latinos and 41% of African-Americans.
In 2011 Pew reported “Smartphone owners under the age of 30, non-white smartphone users, and smartphone owners with relatively low income and education levels are particularly likely to say that they mostly go online using their phones.” It found that almost a third of the “mostly cell” users lack any traditional broadband Internet access. The author of the report concluded, “For businesses, government agencies and nonprofits who want to engage with certain communities, they will find them in front of a four-inch screen, not in front of a big computer in their den.”
According to Colorofchange.org, an organization representing African-Americans, “The digital freedoms at stake are a 21st century civil rights issue.”
Whether or not the proposed merger of AT&T and T-Mobile is completed, network neutrality principles on wireless networks are needed to protect open access to the Internet by millions of Americans.
Resolved:
Shareholders request the company publicly commit to operate its wireless broadband network consistent with network neutrality principles – i.e., operate a neutral network with neutral routing along the company’s wireless infrastructure such that the company does not privilege, degrade or prioritize any packet transmitted over its wireless infrastructure based on its source, ownership or destination.
