Trillium Asset Management, LLC (Trillium) is pleased to announce that, following dialogue with CenturyLink (NYSE: CTL), we are successfully withdrawing our shareholder proposal which was focused on the company’s political spending disclosure.
CenturyLink has agreed to publish publicly a semiannual Political Contributions Report which:
- Discloses processes and procedures for reviewing and approving political expenditures – this will include disclosing the roles and responsibilities of both board members and executives; and disclosing the criteria it uses in making decisions about political expenditures;
- Discloses aggregate data regarding political contributions on a state-by-state basis – with respect to the political expenditures that are aggregated on a state-by-state basis CenturyLink will include (a) independent political expenditures made in support of or in opposition to a candidate or political party and (b) payments made directly or indirectly to influence the outcome of ballot measures;
- Discloses trade association membership and expenditure data, once annual dues and other payments exceed $50,000; and
- Discloses payments to tax-exempt organizations including 501(c)(4)s, super PACs and “unregulated” 527s (e.g., governor’s associations and independent-expenditure only committees, to the extent such 527 entities or organizations are not regulated under state or federal campaign finance laws).
CenturyLink, with a $24 billion market cap, serves the third largest number of lines in the US behind AT&T and Verizon. It provides broadband, voice, third-party wireless and other services to residential and commercial customers in primarily small and midsized markets with a focus in the West and Midwest.
In 2012, shareholders considered the same shareholder proposal filed by Trillium and gave it 41% support, sending a clear message to management that it needed to address concerns about how opaque it was on this question.
This agreement is also an important development for the telecommunications industry. AT&T and Verizon are now political spending disclosure laggards and must now answer questions about why they remain unwilling to join the over 100 large companies with meaningful political spending disclosure.
The telecom industry is now facing critical challenges regarding its control over the free flow of information and calls for greater competition in a highly concentrated market. These issues are not only important to the companies, but given the pivotal role they play in the information economy, they are central to overall economic growth. As legislators, regulators and other policy leaders wrestle with those challenges, investors and the public have the right to know how corporate dollars are spent to influence the political process.
The views expressed are those of the authors as of the date referenced and are subject to change at any time based on market or other conditions. These views are not intended to be a forecast of future events or a guarantee of future results. These views may not be relied upon as investment advice. The information provided in this material should not be considered a recommendation to buy or sell any of the securities mentioned. It should not be assumed that investments in such securities have been or will be profitable. To the extent specific securities are mentioned, they have been selected by the authors on an objective basis to illustrate views expressed in the commentary and do not represent all of the securities purchased, sold or recommended for advisory clients. The information contained herein has been prepared from sources believed reliable but is not guaranteed by us as to its timeliness or accuracy, and is not a complete summary or statement of all available data. This piece is for informational purposes and should not be construed as a research report.