April 21, 2014
Resolution Calls for Transparency in Lobbying Expenditures by Google
by Robert Kropp
Filed by Walden Asset Management and other sustainable investment organizations, the resolution
documents a 250% increase in lobbying expenditures by Google in the last five years. Part one of a
The annual general meeting of tech giant Google will be held on May 14th, and Timothy Smith, Senior
Vice President at Walden Asset
Management, alerted me to a shareowner resolution filed by the firm that will be voted on then.
The resolution “asks Google to expand
disclosure on policies and procedures governing lobbying activities, as well as expenditures for
direct and indirect lobbying through trade associations and tax exempt organizations,” according to
a press release. It requests that Google submit a report to shareowners which include the following
1. Company policy and procedures governing lobbying, both direct and indirect, and
grassroots lobbying communications;
2. Payments by Google used for (a) direct or indirect
lobbying or (b) grassroots lobbying communications, in each case including the amount of the
payment and the recipient;
3. Google’s membership in and payments to any tax-exempt
organization that writes and endorses model legislation; and
4. Description of the decision
making process and oversight by management and the Board for making payments.
None of the
above requests come as a surprise, especially in this proxy season when resolutions addressing
political spending and lobbying expenditures dominate corporate proxy ballots. But what may be
surprising to the unsuspecting is the sheer volume of Google's lobbying expenditures, as well as
its close relationships with trade organizations seem to run counter to a business model widely
praised for its attention to environmental concerns.
The resolution reveals that Google is
“one of the top five corporate lobbyists in the past two years with federal lobbying expenditures
exceeding $30 million.” Its lobbying expenditures have increased by 250% over the past five years;
it has hired more than 100 lobbyists; and it “plans to open a new Capitol Hill office comparable to
the size of the White House.”
Of further concern to shareowners is Google's relationship
with the US Chamber of Commerce and the especially controversial American Legislative Exchange
Council (ALEC). Both organizations are notorious for funding assaults on climate change regulation
and legislation, at a time when the clock is ticking down to the last few seconds left for
meaningful mitigation efforts. “Google reportedly sits on a task force of the American Legislative
Exchange Council (ALEC) which has launched a 'high priority campaign' to repeal renewable energy
standards in states,” the resolution states.
“The resolution is not a criticism of
Googles’ lobbying activities, but rather a call for more transparency and leadership,” Walden
stated. “This shareholder resolution calls on Google, one of the largest corporate lobbyists in the
US, to extend its leadership in the public policy arena by enhancing disclosure of lobbying
decision-making and activities.”
Google's management has recommended that shareowners vote
against the resolution. And because the company has a dual-class stock structure it is next to
impossible for independent shareowners to muster a majority of the overall vote.
press release includes a link to Google's pro
xy statement, a perusal of which reveals a number of shareowner resolutions aimed at improving
the company's corporate governance practices and transparency.
Next: Google faces a
number of governance-related shareowner resolutions.
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