Monday, FedEx is holding its annual shareholder meeting. Since 2010, FedEx has spent over $106 million on federal lobbying on issues like corporate taxes, postal reform, trade agreements and trucking regulations. At the state level it’s much harder to know exactly how much FedEx spends because disclosure requirements at the state level are uneven and data is hard to digest. To alleviate that problem, the company should make this information readily available to its shareholders, which is what investors are asking for in a shareholder resolution that is up for a vote. The proposal is part of an ongoing investor campaign for greater corporate political spending disclosure
FedEx sits on the board of the U.S. Chamber of Commerce. The Chamber spent over $100 million on federal lobbying in 2016 alone. As a member of the Chamber, FedEx should disclose to shareholders exactly how much it pays the trade association to lobby on the company’s behalf, as association with the Chamber can pose a risk to the company’s reputation. For example, FedEx notes its commitment to environmental sustainability on its website and its awards and recognitions for greenest companies, commercial solar power users, eco-airlines and climate innovation index, yet the Chamber has sued to block the EPA Clean Power Plan to address climate change.
If you own shares directly in FedEx you should vote in favor of stockholder proposal #7, which asks the company to prepare an annual report on its lobbying activity so that shareholders- the true owners of the company- can assess the associated risk.
If you don’t own stock directly in FedEx, (or any other company where these types of shareholder resolutions are filed this year), but are worried about the secret way corporations are attempting to influence our democracy, chances are you can have an impact through your 401(k) instead.
Vanguard, BlackRock and the other large mutual fund companies are in a position to move the needle on this issue. As the largest managers of retirement savings these mutual fund giants control significant voting shares in America’s most powerful companies. Vanguard, for example, controls 17,997,225 shares, or 6.73% of FedEx, and BlackRock controls 14,823,307 shares, or 5.54% of FedEx. Yet, Vanguard and BlackRock consistently vote against shareholder proposals that attempt to bring corporate political activity into the light. In 2016, Vanguard abstained on the shareholder proposal asking FedEx to disclose its lobbying to shareholders, which counted as a vote against, and BlackRock voted against. A recent Public Citizen report illustrates just how detrimental the mutual fund companies’ decisions to support corporate executives on these issues are. In 2016, 64% of political spending disclosure shareholder resolutions at companies where mutual funds own more than 5% of common stock would have received majority support if those mutual funds had voted their shares in support of the resolutions. If you invest your retirement through Vanguard, tell the company to change the way it votes so that progress on disclosure can move forward.
Click here to read more from the Teamsters, who filed the lobbying disclosure resolution at FedEx this year.
Click here to read the full investor case for disclosure.
Click here to read the exempt solicitation.