This article originally appeared in The Oilworker, Issue 42.
ExxonMobil shareholders will be considering a USW proposal on the company’s direct and indirect lobbying activities at the annual shareholders meeting on Wed., May 30, 2018 at 9:30 a.m. CT in the Morton H. Meyerson Symphony Center in Dallas, Texas.
USW Local 13-2001 President Ricky Brooks will present the proposal. Joining him at the meeting are several Australian union members who are on strike against a maintenance contractor that works for ExxonMobil’s Australian subsidiary— Esso Australia Pty Ltd (Esso). The Australians have some questions they want the company to answer.
The USW encourages its members who have stock in the company to vote for the proposal- Item #7, which requests the company to provide an annual report on lobbying at the local, state and federal levels:
“Whereas, we believe in full disclosure of ExxonMobil’s direct and indirect lobbying activities and expenditures to assess whether ExxonMobil’s lobbying is consistent with its expressed goals and in the best interests of shareholders.
“Resolved, the shareholders of ExxonMobil request the preparation of a report, updated annually, disclosing:
- Company policy and procedures governing lobbying, both direct and indirect, and grassroots lobbying communications.
- Payments by ExxonMobil used for (a) direct or indirect lobbying or (b) grassroots lobbying communications, in each case including the amount of the payment and the recipient.
- ExxonMobil’s membership in and payments to any tax-exempt organization that writes and endorses model legislation.
- Description of management’s and the Board’s decision-making process and oversight for making payments described in sections 2 and 3 above.”
Grassroots lobbying communication is directed toward the public. It refers to communication about specific legislation or regulation, the company’s view on those items, and its encouragement to the recipient of the communication to take action.
Indirect lobbying means ExxonMobil’s membership in a trade association or other organization that does lobbying.
Each year the report would be presented to the company’s audit committee or other relevant oversight committees and posted on the company website.
Why Support
“The shareholders have a right to know how ExxonMobil is spending their money to influence legislation and change regulatory protection that may not be in their or their family’s best interest,” said Kim Nibarger, head of the USW’s National Oil Bargaining Program. “This proposal is a step in the right direction.”
ExxonMobil spent over $94 million on federal lobbying since 2010. It also lobbies in 33 states, according to an investigative piece from the Center for Public Integrity, but the company’s disclosure is uneven or absent. ExxonMobil does not provide this information, and it is only disclosed if reporters dig for it.
The company also does not disclose its memberships or payments to trade associations or the amount of its money used for the organizations’ lobbying. Again, outside sources reveal that the company is a member of the American Petroleum Institute (API), Business Roundtable and National Association of Manufacturers. These groups collectively spent $44 million on lobbying for 2017.
ExxonMobil is also a member of the American Legislative Exchange Council (ALEC), and its membership drew media focus. ALEC is infamous in labor union circles for creating model legislation that attacks workers’ rights.
Company response
ExxonMobil recommended a vote against the proposal. It said it supports accountability and “appropriate” (editor’s emphasis) transparency and disclosure of lobbying activities and expenditures.
The company said it places its key issues, lobbying activities, and political activities policy and guidelines on its website. In addition, it said it publishes quarterly reports on its federal lobbying and the portions of its payments to trade associations and other groups that spend money on federal lobbying. It says these reports and its contributions to more than 100 U.S.-based organizations, including ALEC, are on its website as well.
In reality, USW and its investor allies have never been able to adequately research the payments paid to trade associations as the company claims. ExxonMobil advised USW that it would give a “tutorial on where to find the data”—but thus far this project has stalled, and the necessary information has not been revealed.
USW Lead Filer
For six years, the USW took the lead in filing this proposal for ExxonMobil’s proxy statement. Last year, it received 28 percent of the shareholder vote - a 2 percent increase from the previous year. USW is joined by over 25 other religious and social responsible investors in our effort for greater transparency and disclosure.
The USW and its institutional investment partners are concerned that inadequate disclosure about ExxonMobil’s state lobbying and payments toward trade association and organization lobbying negatively impacts the corporation’s reputation. That is why a vote “Yes” on Item 7 is necessary.