MORGAN STANLEY GROUP INC. | Lobbying Expenditures Disclosure at MORGAN STANLEY

Status
31.20% votes in favour
AGM date
Previous AGM date
Proposal number
6
Resolution details
Lead filer
Individual
Resolution ask
Report on or disclose
ESG theme
  • Governance
ESG sub-theme
  • Lobbying / political engagement
Type of vote
Shareholder proposal
Filer type
Shareholder
Company sector
Financials
Company HQ country
United States
Resolved clause
RESOLVED, the shareholders of Morgan Stanley request the preparation of a report, updated annually, disclosing:
1. Company policy and procedures governing lobbying, both direct and indirect, and grassroots lobbying communications.
2. Payments by Morgan Stanley 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. Morgan Stanley’s membership in and payments to any tax-exempt organization that writes and endorses model legislation.
4. Description of management’s and the Board’s decision-making process and oversight for making payments described in sections 2 and 3 above.
For purposes of this proposal, a “grassroots lobbying communication” is a communication directed to the general public that (a) refers to specific legislation or regulation, (b) reflects a view on the legislation or regulation and (c) encourages the recipient of the communication to take action with respect to the legislation or regulation. “Indirect lobbying” is lobbying engaged in by a trade association or other organization of which Morgan Stanley is a member.
Both “direct and indirect lobbying” and “grassroots lobbying communications” include efforts at the local, state and federal levels.
The report shall be presented to the Governance and Sustainability Committee and posted on Morgan Stanley’s website.
Supporting statement
SUPPORTING STATEMENT
Full disclosure of Morgan Stanley’s lobbying activities and expenditures is needed to assess whether Morgan Stanley’s lobbying is consistent with its expressed goals and shareholders’ interests. Morgan Stanley spent $37,210,000 from 2010 – 2022 on federal lobbying. This does not include state lobbying, where Morgan Stanley also lobbies. Morgan Stanley also lobbies abroad, spending between €600,000 – 699,999 on lobbying in Europe for 2022.
Companies can give unlimited amounts to third party groups that spend millions on lobbying and undisclosed grassroots activity.1 Morgan Stanley fails to disclose its payments to trade associations and social welfare groups, or the amounts used for lobbying, to shareholders. Morgan Stanley discloses membership in the American Bankers Association (ABA), Bank Policy Institute (BPI), Financial Services Forum (FSF), Securities Industry and Financial Markets Association and US Chamber of Commerce, which together spent $101,826,000 on federal lobbying for 2022. Morgan Stanley’s disclosure omits major trade association memberships, like the Business Roundtable and Managed Funds Association.
Morgan Stanley’s lack of disclosure presents reputational risks when its lobbying contradicts company public positions. For example, Morgan Stanley supports addressing climate change, yet the Business Roundtable opposed the Inflation Reduction Act and its historic investments in climate action,2 and BPI and FSF both lobbied the Securities and Exchange Commission to weaken proposed climate disclosure rules.3 A recent analysis looking at inconsistencies between banks’ public climate commitments and their direct and indirect climate lobbying practices noted Morgan Stanley failed to publicly support the Inflation Reduction Act.4 And while Morgan Stanley does not belong to or support the controversial American Legislative Exchange Council,5 one of its trade associations does, as ABA supported its 2022 annual meeting.6
Morgan Stanley should expand its lobbying disclosure.

Filed by John Chevedden

How other organisations have declared their voting intentions

Organisation nameDeclared voting intentionsRationale
Legal & General Investment Management (Holdings)ForA detailed explanation for our vote intention can be found on the LGIM Blog: https://blog.lgim.com/categories/esg-and-long-term-themes/lgims-voting-intentions-for-2024/
KBI Global InvestorsForShareholders would benefit from increased disclosure to evaluate the company's lobbying efforts and its management of related efforts.

DISCLAIMER: By including a shareholder resolution or management proposal in this database, neither the PRI nor the sponsor of the resolution or proposal is seeking authority to act as proxy for any shareholder; shareholders should vote their proxies in accordance with their own policies and requirements.

Any voting recommendations set forth in the descriptions of the resolutions and management proposals included in this database are made by the sponsors of those resolutions and proposals, and do not represent the views of the PRI.

Information on the shareholder resolutions, management proposals and votes in this database have been obtained from sources that are believed to be reliable, but the PRI does not represent that it is accurate, complete, or up-to-date, including information relating to resolutions and management proposals, other signatories’ vote pre-declarations (including voting rationales), or the current status of a resolution or proposal. You should consult companies’ proxy statements for complete information on all matters to be voted on at a meeting.