Resolved clauseRESOLVED: shareholders request the board of directors amend the charter of the Audit and Compliance Committee of the Board to add to the committee’s “purpose” section appropriate language which makes it clear that the Committee is responsible for overseeing Alphabet’s artificial intelligence activities and ensuring management’s comprehensive and complete implementation of its AI Principles.
1 https://ai.google/responsibility/principles/
2 https://www.nytimes.com/2023/08/16/technology/google-ai-life-advice.html
3 https://www.nytimes.com/2023/09/20/technology/google-bard-extensions.html
4 https://adalytics.io/blog/are-youtube-ads-coppa-compliant , https://www.markey.senate.gov/news/press-releases/senators-markey-blackburn-demand-ftc-investigate-youtube-google-for-suspected-violations-of-childrens-privacy
Whereas clauseWHEREAS: A New York Times article, “Big Tobacco Heralds a Healthier World While Fighting Its Arrival”, [1] reported: “Major cigarette companies, like Altria and R.J. Reynolds, acknowledge that cigarettes are dangerous and addictive, and they are heralding their investments in electronic cigarettes and other less-harmful alternatives to cigarettes. But, behind the scenes , they are taking steps to slow the very smokeless future they claim to want: The companies have submitted letters protesting the proposed menthol ban in traditional cigarettes, and they have signaled they will similarly resist any efforts to lower nicotine levels.”
Altria is a long-time supporter of the American Legislative Exchange Council (ALEC), an organization that brings together corporate lobbyists and legislators and drafts model legislation for state and federal legislators to propose. It is one of the top corporate sponsors of ALEC’s annual conference. Altria’s senior director of government affairs spoke at ALEC’s 2023 conference, and, according to an article by the Center for Media and Democracy, urged “state lawmakers to deregulate the tobacco industry despite the lethal, addictive nature of its products, which are responsible for nearly 500,000 death a year in the U.S.”[2]
Altria also supports initiatives conflicting with its environmental commitments, one of its Responsibility Focus Areas.[3] Altria set science-based greenhouse gas reduction targets yet is a member of the US Chamber of Commerce as well as ALEC, both of which lobbied to roll back specific climate regulations and regulations to slow the transition towards a lower-carbon economy.
While Altria has articulated support for the right to vote[4], the League of Women Voters and over 300 organizations sent a letter to Altria and other corporations to stop funding ALEC because of its voter restriction efforts.[5]
Altria does not disclose the amount of payments to trade associations (TAs) and social welfare groups (SWGs). Companies can give unlimited amounts to TAs and SWGs that spend millions on lobbying. The federal Lobbying Disclosure Act doesn’t require reporting of state lobbying.
While Altria scores well on the Center for Political Accountability (CPA)’s Zicklin Index of Corporate Political Disclosure and Accountability, it has not adopted CPA’s Model Code of Conduct[6], which includes: “disclose dues and other payments made to trade associations and contributions to other tax-exempt organizations that are or that it anticipates will be used for political expenditures. The disclosures shall describe the specific political activities undertaken.”[7]
Altria’s 2022 Lobbying and Political Activity Transparency and Integrity Report provides very useful information; our proposal would close a critical gap in information provided and greatly enhance transparency .
[1] https://www.nytimes.com/2022/11/06/health/tobacco-fda-menthol-ban-nicotine.html?smid=em-share
[2] https://www.exposedbycmd.org/2023/08/21/tobacco-giant-altria-buys-access-to-alec-lawmakers-urges-deregulation/
[3] https://www.altria.com/responsibility/protect-the-environment?src=resp-at-a-glance
[4] https://www.altria.com/about-altria/our-voice-and-actions/where-we-stand-on-voting-rights
[5] https://www.commoncause.org/press-release/common-cause-fair-fight-action-and-over-300-organizations-call-on-corporations-to-cut-ties-with-alec/
[6] https://www.politicalaccountability.net/wp-content/uploads/2022/06/CPA-Zicklin-Model-Code-of-Conduct-for-Corporate-Political-Spending.pdf
[7] https://www.politicalaccountability.net/wp-content/uploads/2022/06/CPA-Zicklin-Model-Code-of-Conduct-for-Corporate-Political-Spending.pdf
Supporting statementSUPPORTING STATEMENT:
In our company’s multi-class voting structure, Class B stock has 10 times the voting rights of Class A. As a result, Mr. Page and Mr. Brin currently control over 51% of our company’s total voting power while owning less than 12% of stock – and will continue to retain voting control even though they have stepped down from leading the company.
Due to this voting structure, our company takes public shareholder money but refuses shareholders an equal voice in the company’s management. For example, it was primarily the weight of the insiders’ 10 votes per share that permitted the creation of a non-voting class of stock (class C) even though most shareholders voted to oppose the move.
In another example, shareholders note that directly-employed Google workers are partially compensated in Class C stock. Google’s compensation philosophy states that “Googlers should share the success of the company,” but without voting rights, these employee-shareholders cannot exercise oversight of executives and find themselves subject to repeated layoffs, outsourcing, and interference with their freedom of association. Moreover, Google hires tens of thousands of contracted workers who have even less say over their indirect employer’s actions. This lack of worker voice can only depress employee performance and innovation.
A variety of corporate governance experts illustrate a growing concern about multi-class share structures:
· The Council for Institutional Investors (CII) recommends a seven-year phase-out of dual class share offerings. The International Corporate Governance Network supports CII’s recommendation “to require to a time-based sunset clause for dual class shares to revert to a traditional one-share/one-vote structure no more than seven years after a company’s IPO date.”
· The International Corporate Governance Network supports CII’s recommendation “to require to a time-based sunset clause for dual class shares to revert to a traditional one-share/one-vote structure no more than seven years after a company’s IPO date.”
· The Investor Stewardship Group recommends that “shareholders should be entitled to voting rights in proportion to their economic interest” and “boards should have a strong, independent leadership structure.”
· As of October 1, 2023, Institutional Shareholder Services (ISS), which rates companies on governance risk, gave our company a 10, its highest risk category, for the Governance QualityScore.
Shareholders are encouraged to vote FOR this good governance request to allow better shareholder oversight.