Truist Financial | Lobbying Expenditures Disclosure at Truist Financial

Status
41.17% votes in favour
AGM date
Previous AGM date
Proposal number
4
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 HQ country
United States
Resolved clause
RESOLVED, the shareholders of Truist Financial Corporation (“Truist”) 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 Truist 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. Truist’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 Truist 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 Nominating and Governance Committee and posted on Truist’s website.
Supporting statement
SUPPORTING STATEMENT
Full disclosure of Truist’s lobbying activities and expenditures is needed to assess whether Truist’s lobbying is consistent with its expressed goals and shareholders’ interests. Truist spent $11,175,900 from 2019 – 2022 on federal lobbying. This does not include state lobbying, where Truist also lobbies. Truist’s lobbying over the debt ceiling has attracted scrutiny.1
Companies can give unlimited amounts to third party groups that spend millions on lobbying and undisclosed grassroots activity.2 Truist fails to disclose its payments to trade associations and social welfare groups (SWGs), or the amounts used for lobbying, to shareholders. Truist belongs to the American Bankers Association (ABA), Bank Policy Institute (BPI), Business Roundtable, Securities Industry and Financial Markets Association and US Chamber of Commerce, which together spent $119,896,000 on federal lobbying for 2022.
Truist’s lack of disclosure presents reputational risks when its lobbying contradicts company public positions. For example, Truist publicly supports addressing climate change, yet the Business Roundtable opposed the Inflation Reduction Act,3 the Chamber reportedly has been a “central actor” in dissuading climate legislation over a two-decade period,4 and BPI lobbied the Securities and Exchange Commission to weaken proposed climate disclosure rules.5 A recent analysis looking at inconsistencies between banks’ public climate commitments and their direct and indirect climate lobbying practices noted Truist failed to publicly support the Inflation Reduction Act.6 And while Truist does not belong to or support the American Legislative Exchange Council, which is attacking “woke” investing,7 its trade associations do, as the Chamber sits on its Private Enterprise Advisory Council8 and ABA supported its 2022 annual meeting.9
Reputational damage stemming from these misalignments could harm shareholder value. Truist should expand its lobbying disclosure.
1 https://www.politico.com/newsletters/politico-influence/2023/04/27/whos-lobbying-on-the-debit-ceiling-fight-00094301.
2 https://theintercept.com/2019/08/06/business-group-spending-on-lobbying-in-washington-is-at-least-double-whats-publicly-reported/. https://www.truist.com/content/dam/truist-bank/us/en/documents/disclosures/non-lob/truist-2022-tcfd.pdf
3 https://www.theguardian.com/environment/2022/aug/19/top-us-business-lobby-group-climate-action-business-roundtable.
4 https://www.washingtonpost.com/politics/2023/08/02/climate-group-pushes-big-tech-exit-nations-largest-business-lobby/.
5 https://www.eenews.net/articles/banks-to-sec-climate-rule-poses-real-world-problems/.
6 https://www.ceres.org/news-center/press-releases/new-benchmark-analysis-us-banks-reveals-inconsistencies-between-climate.
7 https://www.wbur.org/hereandnow/2023/03/22/esg-investing-fossil-fuels.
8 https://ohiocapitaljournal.com/2023/09/06/coming-soon-in-ohio-alec-releases-new-raft-of-model-legislation/.
9 https://documented.net/investigations/heres-who-bankrolling-alec-2022-annual-meeting.

Filed by John Chevedden

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