Sherwin-Williams Co. | Issue an Annual Lobbying Report at Sherwin-Williams Co.

Status
Filed
AGM date
Previous AGM date
Proposal number
7
Resolution details
Company ticker
SHW
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
Industrials
Company HQ country
United States
Resolved clause
Resolved, shareholders of Sherwin-Williams 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 Sherwin-Williams 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. Sherwin-Williams’ membership in and payments to any tax-exempt organization that writes and endorses model legislation;
4. Description of management’s decision-making process and the Board’s oversight for making payments described 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 Sherwin-Williams 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 Audit Committee and posted on Sherwin-Williams’ website.
Supporting statement
Full disclosure of Sherwin-Williams’ lobbying activities and expenditures is needed to assess whether its lobbying is consistent with its expressed goals
and shareholder interests. Sherwin-Williams spent $2.9 on federal lobbying from 2020—2023. Sherwin-Williams also lobbies at the state level, spending
$1.2 million on lobbying in California in 2018 in an attempt to reduce its liability for lead paint in California buildings.1 Sherwin-Williams also lobbies
abroad, spending between €100,000 – 199,999 on lobbying in Europe for 2023. Companies can give unlimited amounts to third party groups that spend millions on lobbying and often undisclosed grassroots activity. These groups may
be spending “at least double what’s publicly reported.”2 Sherwin-Williams fails to disclose its memberships in or payments to trade associations and social
welfare groups (SWGs), or the amounts used for lobbying, to shareholders. Sherwin-Williams serves on the board of the National Association of
Manufacturers (NAM), which has spent over $225 million on federal lobbying since 1998. And Sherwin-Williams has been previously identified as a
member of the Plastics Industry Association.3
Sherwin-Williams’ lack of disclosure presents reputational risk when its lobbying contradicts company public positions. For example, Sherwin-Williams
publicly supports addressing climate change, yet NAM leverages its “influence to obstruct climate policy progress in the U.S. at the federal, state and local
levels.”4 And while Sherwin-Williams does not belong to the controversial American Legislative Exchange Council, which has pushed preemption
legislation to deny municipalities the right to access courts,5 it was represented by NAM, which previously sat on its Private Enterprise Advisory Council.6
Reputational damage stemming from these misalignments could harm shareholder value. Thus it will be a best practice for Sherwin-Williams Company to
expand its lobbying disclosure.
2 https://theintercept.com/2019/08/06/business-group-spending-on-lobbying-in-washington-is-at-least-double-whats-publicly-reported/.
3 https://www.asyousow.org/blog/sustainable-companies-support-plastic-bag-lobbyists.
4 https://www.greenbiz.com/article/dont-play-both-sides-take-3-steps-now-fix-your-trade-group-gap.
5 https://climateintegrity.org/news/view/new-report-documents-the-corporate-campaign-to-deny-municipalities-access-to-the-courts.
6 https://www.exposedbycmd.org/2023/02/03/alec-expands-private-board-of-directors-with-woke-capitalism-fighters/.

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.