INTERNATIONAL BUSINESS MACHINES (IBM) CORPORATION | Report on lobbying in line with net zero GHG commitment at IBM

Status
Filed
AGM date
Previous AGM date
Resolution details
Company ticker
IBM
Lead filer
Individual
Resolution ask
Report on or disclose
ESG theme
  • Governance
ESG sub-theme
  • GHG targets / emissions
  • Lobbying / political engagement
Type of vote
Shareholder proposal
Filer type
Shareholder
Company sector
Technology
Company HQ country
United States
Resolved clause
The stockholders of IBM request the preparation of a report, updated annually, disclosing:

Company policy and procedures governing lobbying, both direct and indirect, and grassroots lobbying communications.
Payments by IBM used for (a) direct or indirect lobbying or (b) grassroots lobbying communications, in each case including the amount of the payment and the recipient.
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 IBM 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 IBM’s website.
Supporting statement
IBM spent $72.7 million from 2010 – 2023 on federal lobbying. This does not include state lobbying, where IBM also lobbies, spending $1,083,050 on lobbying in California from 2010 – 2023. IBM also lobbies abroad, spending between €1,750,000 – 1,999,999 on lobbying in Europe for 2022.

Companies can give unlimited amounts to third party groups that spend millions on lobbying and undisclosed grassroots activity. These groups may be spending “at least double what’s publicly reported.”[1] Unlike many of its peers, IBM fails to disclose its payments to trade associations and social welfare groups (SWGs), or the amounts used for lobbying, to stockholders. IBM belongs to the Business Roundtable and US Chamber Commerce, which together have spent over $2.3 billion on federal lobbying since 1998. IBM’s disclosure includes SWG the Alliance for Competitive Taxation (ACT) but leaves others out, like the Bay Area Council and Future of Privacy Forum.

IBM’s lack of disclosure presents reputational risk when its lobbying contradicts company public positions. For example, IBM believes in addressing climate change, yet the Business Roundtable filed an amicus brief opposing the Securities and Exchange Commission climate risk disclosure rules.[2] and the Chamber reportedly has been a “central actor” in dissuading climate legislation over a two-decade period.[3] IBM has attracted scrutiny for avoiding federal income taxes,[4] as the Business Roundtable has lobbied against a new minimum corporate tax[5] and ACT has put out a study claiming higher corporate taxes would harm workers in every state.[6] Reputational damage stemming from these misalignments could harm stockholder value.

I urge IBM to expand its lobbying disclosure.



[1] https://theintercept.com/2019/08/06/business-group-spending-on-lobbying-in-washington-is-at-least-double-whats-publicly-reported/.

[2] https://www.eenews.net/articles/investors-question-business-roundtables-climate-rule-battle/.

[3] https://www.washingtonpost.com/politics/2023/08/02/climate-group-pushes-big-tech-exit-nations-largest-business-lobby/.

[4] https://www.axios.com/2019/12/16/fortune-500-companies-corporate-income-tax.

[5] https://www.washingtonpost.com/business/2023/08/14/biden-corporate-tax/.

[6] https://www.actontaxreform.com/media/mnnpgwib/act-state-wage-effects-of-corporate-tax-increase-2.pdf.

How other organisations have declared their voting intentions

Organisation nameDeclared voting intentionsRationale
Kutxabank Gestion SGIIC SAU.For

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