For the third year in a row, the Unitarian Universalist Association filed a shareholder resolution with Blackrock asking the company to improve its disclosure of lobbying expenditures and policies. The proposal was nearly identical to that in the 2019 proxy statement. This week the UUA announced that it has withdrawn this year’s resolution after the company agreed to significantly expand its reporting on lobbying by listing its trade association memberships and explaining how the company’s board oversees this activity. This means the proposal will not be voted on at the annual general meeting. Tim Brennan, Special Advisor on Responsible Investing, said, “While there is still significant room for improvement, listing all of the company’s trade association memberships adds significant transparency. We appreciate the strides Blackrock has taken over the last three years.” In addition, the company has agreed to add lobbying oversight to the charter of the corporate governance committee of the board of directors. The UUA will continue to press the company to disclose the actual amounts of trade association dues used for lobbying and has reserved the right to re-file the resolution next year.
Here’s why this is important. Since the Supreme Court’s 2010 Citizens United decision, the political process has been flooded with cash. And much of it is “dark money;” that is, contributions funneled through Super PACs, trade associations and nonprofit organizations that make it difficult to trace the source of the money. In the Court’s decision, at the same time that five justices threw out limits on corporate political spending, eight of the nine justices upheld the ability of the government to impose disclosure requirements, saying that “transparency enables the electorate to make informed decisions and give proper weight to different speakers and messages.” However, these requirements have not been forthcoming. The SEC has dithered, and the Congress has been unable to act. This is why investors are putting lobbying disclosure at the top of their agendas, pressing corporations for greater corporate transparency. The UUA is playing its part.