Despite a downward trend in the overall number of environmental, social, and governance (ESG) shareholder proposals, support for shareholder proposals demanding increased political accountability and transparency surged in the 2025 proxy season, according to the Center for Political Accountability (CPA). In particular, CPA reported that in 2025, the average overall vote in support of CPA-proposed shareholder proposals rose to 41.6%, up from 26.2% in 2024, marking the third strongest year for such proposals after 2020 and 2021. Of the 28 CPA political disclosure resolutions filed, 13 went to a vote and five passed with majority shareholder support. Meanwhile, seven companies were able to secure the withdrawal of these proposals after adopting political accountability and disclosure policies. This year’s approval rate demonstrates that even as investors are generally stepping back from ESG issues, scrutiny of corporate political spending remains high, perhaps motivated by increasing polarization of the political landscape.
Calls for greater accountability and disclosure around corporate political spending and political action committee (PAC) activity first emerged as a trend in 2016, when North Carolina passed its “Bathroom Bill,” and have intensified in the wake of significant cultural and political moments, such as the events at the U.S. Capitol on January 6, 2021. Further, in addition to the elevated frequency and intensity of these shareholder demands, the nature of the demands has evolved over the last few years to go beyond requests merely for enhanced disclosure. Increasingly, shareholders are using these proposals to demand substantive changes to corporate giving protocols, including commitments by the company to refrain from certain kinds of political spending and related requests to ensure alignment between the company’s public positions on certain issues and its lobbying activity.
When confronted with a shareholder proposal targeting corporate political activity, it is important for a company to give thoughtful consideration to what disclosures and other measures it agrees to implement. This consideration should involve all impacted stakeholders, including the corporate secretary’s office, legal and compliance functions, government relations and investor relations, to determine whether and how to respond to the proposal and to confirm all are comfortable with any resulting changes. Equally important is establishing adequate procedures to meet any heightened disclosure and other obligations. This may require implementing brand new procedures, but often can be accomplished by adapting and expanding existing processes. For example, an existing contribution preclearance process designed to ensure compliance with campaign finance and pay-to-play laws could be leveraged to flag contributions for disclosure on the company’s website. Regardless of the specific measures to be implemented, taking a thoughtful, coordinated approach on the front end helps make sure that government relations, compliance functions and other stakeholders are not surprised by new restrictions and disclosure requirements and are able to seamlessly transition to the new regime.
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