Dive Brief:
- Knight-Swift Transportation Holdings shareholders want visibility into the political contributions the company makes using corporate funds, according to an April 3 proxy statement.
- The proposal calls for a semi-annual report identifying candidates and organizations the company has supported and the amount paid to each. Reports would also divulge any expenditures used to influence the result of an election.
- Knight-Swift’s board of directors argues that the proposal is unnecessary because the company does not make contributions to any candidate, political party, action committees or other political organizations.
Dive Insight:
Political transparency is increasing among the nation’s largest corporations, with 70% of S&P 500 companies volunteering information about their political contributions or saying they do not make any, per the Harvard Law School Forum on Corporate Governance.
Corporations are not legally allowed to donate to candidates campaigning for federal office or national political parties. Additionally, in Knight-Swift’s home state of Arizona, state-level contributions are prohibited, according to the Center for Political Accountability.
However, trade organizations Knight-Swift supports, such as the American Trucking Associations, help to elect federal candidates that support the trucking industry. So while Knight-Swift may not contribute directly, it could have indirect connections to political campaigns.
“Our participation in these organizations does not mean we endorse every position taken by the organizations or the views of their leaders or members, but we are fully committed to engaging in the collaborative problem-solving process and to working with our industry peers in these organizations,” Knight-Swift’s board said in its response.
Conversely, the shareholder proposal contends that a company’s reputation, value and bottom line can be damaged by political spending — including when giving to trade associations.
The shareholders claim that Knight-Swift would catch up with peers like J.B. Hunt Transport Services, CSX and Norfolk Southern by disclosing its payments to trade associations.
“Without knowing the recipients of our company’s political dollars, Knight-Swift directors and shareholders cannot sufficiently assess whether our company’s election-related spending aligns or conflicts with its policies on climate change and sustainability, or other areas of growing concern,” the proposal states.
