Corporate Disclosure of State Lobbying Virtually Non-Existent; Just One S&P 500 Company Reports All State Lobbying Expenditures

State Lobbying Spending Concentrated Among Handful of Corporate Giants, Health Care Companies, and Altria

Only 25 Percent of Corporate Boards Have Board-level Policies on Lobbying

Webinar on Wednesday, March 22 at 1 PM ET to Review Findings

NEW YORK, NY (March 1, 2017) – A new study reveals virtually no disclosure of corporate expenditures related to political lobbying activities at the state level among the S&P 500 companies. Even at the federal level, only 25 percent of companies have board-level policies on lobbying and only 12 percent disclose actual spending.

Using data gleaned from state reports, the report finds that health care firms dominated the spending of 100 large companies studied. This sector spent $41 million from 2012 to 2015 in six states studied, selected because they are believed to have the most lobbying. It also finds that state lobbying spending is concentrated among a few large companies. AT&T, Altria, Verizon and Chevron top the list, with each incurring four-year state lobbying expenses of more than $13.5 million in the six states analyzed.

These findings are contained in a new study, How Leading U.S. Corporations Govern and Spend on State Lobbying, conducted by the Sustainable Investments Institute (SI2) and funded by the Investor Responsibility Research Center Institute. (IRRCi).

Download the full study and selected company profiles here.

Register for a webinar here on Wednesday, March 22, 2017 at 1 PM ET to review the findings.

“As the recent court-ordered release of e-mails between then Oklahoma Attorney General and now Environmental Protection Administrator Scott Pruitt reveal, companies spend and lobby extensively to influence state policies,” said Jon Lukomnik, IRRCi executive. “However, investors have learned that election spending is fraught with both risk and opportunity for companies. That is why many companies have adopted board-level campaign contribution policies and disclosures. It is time for companies to take the same approach to lobbying at both the federal and state level. It’s time for lobbying expenditures to come out of the darkness.”

Investors have increasingly called for corporate disclosure of both election contributions and lobbying. Some 90 percent of S&P 500 companies have board level policies regarding campaign contributions, compared to the quarter which have policies on lobbying. However, those policies largely apply to the federal government. But even then, only 12 percent of companies disclose actual federal lobbying expenditures to investors. Disclosure at the state level is virtually non-existent. Only Walmart reports all its state lobbying expenditures; five percent of S&P 500 companies reveal which states they lobby in and two percent reveal aggregate lobbying costs.

The federal government, increasingly, is asking states to take the lead on major policymaking, touching everything from healthcare to immigration and the environment,” report author Heidi Welsh says. “But we know almost nothing about corporate spending to influence state officials who are making the decisions. Uniform disclosure standards for companies could fix this problem and enable investors compare companies rather being left in the dark.”

As the report notes, investors are concerned about these issues. Since 2014, more than half of shareholder proposals at public companies that concern political activity have included requests for actions related to lobbying.

Considerable information is available about federal political spending, including lobbying, but data are not available for all the states. There are no disclosure requirements for 22 states. Even where disclosure requirements do exist, they are mixed in their comprehensiveness and utility. Si2 researchers therefore hand collated lobbying reports from six states believed to have the highest level of lobbying expenditures (among the 28 which have some level of disclosure): California, Florida, New Jersey, Minnesota, New York and Washington.

The report finds that state lobbying spending is concentrated among a small number of very large companies. AT&T, Altria, Verizon and Chevron top the list, with each incurring four-year state lobbying expenses of more than $13.5 million in the six states analyzed.

The average company in the study spent a total of $2.6 million in the six states over the four years. Looking at spending intensity, the average company spent $11.40 per $1 million of revenue during the same time period. Altria was by far the most intense spender, writing lobbying checks for $143.70 out of each $1million in revenue, or about four times that of runner-up, Pfizer, which spent $36.40.

Health care firms dominate the spending of the 100 biggest companies in the six states studied. This sector spent $41 million from 2012 to 2015 in those six states. Health insurers in particular opened their wallets to influence state governments as the Affordable Care Act was being set up—five companies spent $19.3 million; UnitedHealth Group alone spent $5.5 million. A third of the spending by insurers occurred in California.

Chevron accounted for $15.7 million, or 52 percent of the $27.7 million spent by energy companies in the selected states over the four years. Nearly all of this was in California, where the state is implementing its Global Warming Solutions Act to curb greenhouse gas emissions and bolster a renewable energy economy

Download the full study and selected company profiles here. 

The Investor Responsibility Research Center Institute is a not-for-profit organization headquartered in New York, NY, that provides thought leadership at the intersection of corporate responsibility and the informational needs of investors. More information is available at
The Sustainable Investments Institute
is a nonprofit organization based in Washington, D.C., that conducts impartial research on corporate and investor responsibility issues. Si2 also conducts research into emerging sustainability issues to better help investors and the public understand the implications for companies and their key stakeholders.

Media Contact:

Kelly Kenneally
Investor Responsibility Research Center Institute