Conservative shareholder-activists have increased the pressure on “woke” companies over the past week as the rift between once-business-friendly Republicans and corporate America has widened.
Activists said they felt heartened by a worse-than-expected first-quarter earnings report from The Walt Disney Co., which came as Republicans in Florida stripped the company of preferential tax benefits following criticism company public protests against a new state law restricting some classroom teaching about sexual orientation and gender identity. But the fate of anti-reawakening proposals at several annual shareholder meetings has been more mixed.
Shareholders of Verizon, ConocoPhillips and CVS Health all rejected conservative proposals that the backers said sought to expose left-leaning corporate activism on issues ranging from racial hiring quotas to Chinese Communist business ties. They did so on the recommendations of their boards of directors, who opposed all measures.
Conservative shareholder activists nonetheless considered it a victory that their proposals were aired at the often stuffy annual gatherings dominated by the management agenda.
“The most newsworthy aspect for promoters like us is that we have the ability to speak directly to directors and senior executives at these shareholder meetings,” said Paul Chesser, director of the Corporate Integrity Project at the National Legal and Policy Center, in an email. .
Mr. Chesser’s NLPC, which buys shares in large corporations, demanded that the companies be clear about their funding of progressive advocacy groups at annual shareholder meetings at Verizon and ConocoPhillips.
Mr. Chesser told Verizon shareholders on Thursday that Chairman and CEO Hans Vestberg made “white guilt” donations during the 2020 Black Lives Matters protests “as he virtue signaled his commitment to “diversity and inclusion” by committing $10 million of corporate resources to so-called social justice organizations.
He said the company did not disclose the amount of money it gave to the advocacy groups of progressive activists Jesse Jackson and Al Sharpton.
Verizon’s board of directors opposed the proposal, shareholders in a proxy statement, “We have appropriate governance processes in place, which confirm that our donations are aligned with our values and purpose. .”
Verizon shareholders also rejected a proposal by shareholder Steven Milloy, telling a Fox News lobbyist and commentator that demanded a report on the company’s business ties to China’s ruling Communist Party.
On Tuesday, ConocoPhillips shareholders rejected another proposal by Mr Chesser calling for an audit of their charitable contributions to left-wing advocacy groups.
“Regarding [the proposal], ConocoPhillips is delighted that shareholders have recognized our robust engagement system which seeks to understand and adapt to the changing needs of our stakeholders,” a Conoco spokesperson told The Times in an email. “We will continue to engage our stakeholders on this issue using our existing process.”
Despite the rebuffs, “momentum continues to build for shareholder rights and against woke activism,” insisted Elaine Parker, president of the Job Creators Network Foundation, in an email to The Times.
Ms Parker, whose advocacy group has launched a boardroom initiative, noted Disney shares have fallen ‘about 25%’ since the company began fighting Florida’s parental rights law in education, which bans gender identity classes in K-3 public school classrooms.
“We are optimistic that the Disney fiasco will prove to be a milestone in this larger cultural debate,” she said. “We are winning but some of the most important fights are yet to come.”
Disney, which did not respond to a request for comment, nevertheless claimed a win this week by narrowly beating expectations for subscriptions to its Disney+ streaming app.
Activists at the National Center for Public Policy Research, which buys stock in companies through its Free Enterprise Project, proposed an audit of CVS Health’s diversity hiring goals and program on Wednesday. employee anti-racism training.
“What we are asking of the company is a report that focuses on whether, in its myriad diversity, inclusion and equity efforts, the company demonstrates discrimination against employees it has not honored with the ‘diverse’ label,” project manager Scott Shepard said. director, CVS shareholders told their annual meeting on Wednesday.
CVS shareholders rejected the proposal — the 27th the NCPPR has presented to shareholder meetings so far this year after previous efforts at Disney, Coca-Cola, Bank of America and Citigroup — after its board of directors administration deemed the report unnecessary.
However, Kohl shareholders also on Wednesday rejected a Liberal investor’s proposal to replace up to 10 directors at their annual meeting – a move the Tories had also opposed.
Most of the companies targeted this week did not respond to a request for comment.
The NCPPR also urged shareholders to vote against all board members of Intel, Wyndham Hotel Group and Ford Motor Co. for what it said was their role in promoting progressive policies. All were re-elected.
Investor William Flaig, CEO of the American Conservative Values ETF which boycotts many companies, said shareholder activism educates conservatives about liberal bias in boardrooms, even when it fails win shareholder votes.
“The market selloff notwithstanding, this week saw some positive developments for politically conservative investors,” Flaig told The Times in an email. “I think we have acquired enough knowledge to begin the battle against woke corporate culture.”
Michael Warder, director of financial services firm Warder Consultancy in California, said many companies are adopting woke policies to appease younger stakeholders and employees – a move he says will hurt their wallets over time. .
“America’s CEOs and board members should be wary of trying to pacify a relatively small group of left-wing activists who try to enlighten them on race, gender, class and other issues,” he said. Mr Warder. “So-called ‘main street Americans’ will respond to these attempts in a way that will affect their results.”
Attorney Jeremy Tedesco, senior vice president of corporate engagement for legal advocacy group Alliance Defending Freedom, said conservatives have come to realize that corporate culture no longer promotes “essential supports of liberal democracy”.
“The increased Conservative advocacy to achieve these goals is very welcome,” Tedesco said.
The growing ideological tensions on display at shareholder meetings are also playing out on Capitol Hill and in state legislatures such as Florida.
Republican lawmakers have also taken action at the state and federal levels to end tax benefits for companies they believe engage in partisan politics. Sen. Josh Hawley of Missouri introduced a bill on Tuesday that would strip Disney Co. of special copyright protections granted by Congress and impose shorter deadlines on how long new copyrights will last.