Investors and Advocates Push Pfizer for More Transparency

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  • Dale Eisman
Common Cause, Health Professionals and Allied Employees Union Call on Company to leave ALEC

Amid heightened public concern about the influence of big money on elections and decision-making in Congress and state legislatures, Common Cause and the Health Professionals and Allied Employees Union called on Pfizer today to disclose its lobbying activity (including indirect lobbying through trade associations and tax-exempt organizations) and drop its membership in the American Legislative Exchange Council (ALEC), a controversial state level lobbying organization.

At the Pfizer shareholders meeting in Short Hills, NJ, shareholders considered a resolution filed by the Christopher Reynolds Foundation that would require Pfizer to review its membership in third party lobbying groups, including ALEC. The resolution, which received the votes of 5.7 percent of Pfizer shareholders, calls on Pfizer to review whether the lobbying organizations it is funding operate in ways consistent with the company’s stated policies and principles. It also asks Pfizer to consider the reputational risk that accompanies involvement in such political groups.

“Pfizer shareholders have no sense of the size of payments made to trade associations or the percent spent on lobbying,” said Marilyn Carpinteyro of Common Cause. “Transparency of Pfizer’s political spending and lobbying activities is important to protect shareholders and consumers in the post-Citizens United era.”

Common Cause has filed a “whistleblower” complaint against ALEC with the Internal Revenue Service, accusing the group of violating its tax-exempt status by operating as a lobby while claiming to be a charity. The group’s tax exemption allows its corporate supporters to take tax deductions on millions spent each year to support ALEC’s activities, in effect providing a taxpayer subsidy for its lobbying.

Pfizer has become a political powerhouse, with reported spending of nearly $9.5 million on federal lobbying in 2014. The amount Pfizer spends on indirect lobbying through third party groups is hidden from shareholders and the public. Pfizer’s membership in ALEC has come under considerable criticism recently. In March, 84 public interest, religious, environmental, labor, public health, civil rights, and investor organizations sent Pfizer a letter urging the company leave ALEC, largely due to ALEC’s controversial positions on climate change and healthcare. Since then, more than 82,000 people have signed petitions urging Pfizer to cut ties with ALEC.

“As healthcare professionals who use Pfizer products in our work, the New Jersey Health Professionals and Allied Employees are concerned that Pfizer’s membership in ALEC is at odds with their mission “to provide access to safe, effective and affordable medicines and related health care services to the people who need them,” said Ann Twomey, President of the Health Professionals and Allied Employees, AFT, AFL-CIO. “ALEC has promoted policies that privatize health care and deny health coverage for those in need.”

Shareholder resolutions requesting disclosure of a company’s political contributions or lobbying expenditures have been on the rise. From 2010 to 2014, shareholders have filed 530 resolutions related to corporate political activity.  In addition to the resolution at Pfizer, shareholders have filed more than 110 proposals around political activity in 2015, or more than one-quarter of all shareholder proposals this year.