- Policies and procedures for making, with corporate funds or assets, contributions and expenditures (direct or indirect) to (a) participate or intervene in any political campaign on behalf of (or in opposition to) any candidate for public office, or (b) influence the general public, or any segment thereof, with respect to an election or referendum.
- Monetary and non-monetary contributions and expenditures (direct and indirect) used in the manner described in section 1 above, including:
- The identity of the recipient as well as the amount paid to each; and
- The title(s) of the person(s) in the Company responsible decision-making.
The report shall be presented to the board of directors or relevant board committee and posted on the Company’s website.
Long-term shareholders of Hess support transparency and accountability in corporate spending on political activities. These activities include direct and indirect political contributions to candidates, parties, or organizations; independent expenditures; or electioneering communications on behalf of federal, state or local candidates.
Disclosure is in the best interest of the company and its shareholders, and critical for compliance with federal ethics laws. Moreover, the Supreme Court’s Citizens United decision recognized the importance of political spending disclosure for shareholders when it said, “[D]isclosure permits citizens and shareholders to react to the speech of corporate entities in a proper way. This transparency enables the electorate to make informed decisions and give proper weight to different speakers and messages.” Gaps in transparency and accountability may expose the company to reputational and business risks that could threaten long-term shareholder value.
We are concerned that there seems to be such an accountability gap at Hess. The Company states in its Code of Conduct that it does not make political contributions with corporate funds. However, publicly available sources (the New York State Board of Elections Campaign Finance Disclosure and the New Jersey Election Law Enforcement websites) indicate that it has given at least $20,308 in state-level contributions since 2001. This discrepancy between stated policy and public records suggests a gap in the Company’s compliance systems, making this resolution even more important.
Moreover, the 2012 CPA-Zicklin Index of Corporate Political Accountability and Disclosure ranked Hess at the bottom of the five “Petroleum Refining” companies for political disclosure – with a score of just 13 out of 100 points. This proposal asks the Company to disclose all of its political spending, including payments to trade associations and other tax exempt organizations used for political purposes. This would bring our Company in line with a growing number of leading companies, including Exelon, Merck and Microsoft that support political disclosure and accountability and present this information on their websites.
The Company’s Board and its shareholders need comprehensive disclosure to be able to fully evaluate the political use of corporate assets. We urge your support for this critical governance reform.