Conservative shareholder-activists turned up the pressure on “woke” companies over the past week as the rift between once business-friendly Republicans and corporate America deepened.
The activists said they felt buoyed by a worse-than-expected first-quarter earnings report at The Walt Disney Co., which came as Republicans in Florida stripped the company of preferential tax benefits over the company’s public criticism of a new state law restricting certain classroom instruction about sexual orientation and gender identity. But the fate of anti-woke proposals at several annual shareholder meetings was more mixed.
Shareholders at Verizon, ConocoPhillips and CVS Health all voted down conservative proposals that backers said were aimed at exposing left-wing corporate activism on issues ranging from racial hiring quotas to Chinese communist business ties. They did so on the recommendations of their boards of directors, which opposed all the measures.
Conservative shareholder activists nevertheless counted it a win that their proposals got an airing at all in the often staid annual gatherings dominated by the management’s agenda.
“The more newsworthy aspect for proponents like us is that we have the opportunity to speak to directors and top executives directly at these shareholder meetings,” Paul Chesser, director of the Corporate Integrity Project at the National Legal and Policy Center, said in an email.
Mr. Chesser’s NLPC, which purchases stock in major corporations, demanded companies come clean on their corporate funding of progressive advocacy groups at the annual shareholder meetings of Verizon and ConocoPhillips.
Mr. Chesser told Verizon shareholders on Thursday that Chair and CEO Hans Vestberg made “white-guilt” donations during Black Lives Matters protests in 2020 “as he virtue-signaled his commitment to ‘diversity and inclusion’ by committing $10 million of company resources to so-called social justice organizations.”
He said the company failed to disclose how much money it gave to the advocacy groups of progressive activists Jesse Jackson and Al Sharpton.
Verizon’s board opposed the proposal, shareholders in a proxy statement, “We have appropriate governance processes in place, which confirm that our giving is aligned with our values and purpose.”
Verizon shareholders also rejected a proposal from shareholder Steven Milloy, telling a lobbyist and Fox News commentator who demanded a report on the company’s business ties to China’s ruling Communist Party.
On Tuesday, ConocoPhillips shareholders voted down yet another proposal from Mr. Chesser calling for an audit of their charitable contributions to left-wing advocacy groups.
“Regarding [the proposal], ConocoPhillips is pleased that stockholders recognized our robust engagement system that seeks to understand and adapt to the changing needs of our stakeholders,” a Conoco spokesperson told the Times in an email. “We will continue to engage our stakeholders on this issue utilizing our existing process.”
Despite the rebuffs, “momentum continues to build for shareholders’ rights and against woke activism,” Elaine Parker, president of the Job Creators Network Foundation, insisted in an email to The Times.
Ms. Parker, whose advocacy group has launched a boardroom initiative, noted that Disney’s stock had dropped “about 25%” since the company started battling Florida’s Parental Rights in Education law, which bans lessons on sexual identity in K-3 public school classrooms.
“We’re optimistic that the Disney fiasco will turn out to be a milestone in this broader cultural debate,” she said. “We are winning but some of the most important fights are still to come.”
Disney, which did not respond to a request for comment, nevertheless claimed a win this week in narrowly exceeding expectations for subscriptions to its Disney+ streaming app.
Activists from the National Center for Public Policy Research, which purchases stock in companies through its Free Enterprise Project, proposed an audit on Wednesday of CVS Health’s diversity hiring goals and employee anti-racism training program.
“What we are asking the company for is a report that focuses on whether, in its myriad diversity, inclusion and equity efforts, the company is discriminating against employees that it has not honored with the label ‘diverse,’” Scott Shepard, the project’s director, told CVS shareholders at their annual meeting on Wednesday.
CVS shareholders rejected the proposal — the 27th that the NCPPR has presented at shareholder meetings so far this year after earlier efforts at Disney, Coca-Cola, Bank of America and Citigroup — after its board deemed the report unnecessary.
However, Kohl’s shareholders on Wednesday also rejected a liberal investor’s proposal to replace up to 10 board directors at their annual meeting — a move conservatives had also opposed.
Most of the companies targeted this week did not respond to a request for comment.
The NCPPR also urged shareholders to vote against all of the board members of Intel, Wyndham Hotel Group and Ford Motor Co. for what it said was their role in promoting progressive policies. All were reelected.
Investor William Flaig, CEO of the American Conservative Values ETF that boycotts many of the companies, said shareholder activism raises conservative awareness about liberal bias in boardrooms even when it fails to win shareholder votes.
“Notwithstanding the market sell-off, this week had some positive developments for politically conservative investors,” Mr. Flaig told the Times in an email. “I believe we have gained enough awareness to begin the battle on woke corporate culture.”
Michael Warder, principal at the Warder Consultancy financial services firm in California, said many companies adopt woke policies to appease younger stakeholders and employees — a move he says will hurt their pocketbooks over time.
“American CEOs & board members should be wary of attempting to pacify a comparatively small group of leftist activists who attempt to gaslight them on race, gender, class and such issues,” Mr. Warder said. “So-called ‘Main Street Americans’ will respond to these attempts in ways that will affect their bottom lines.”
Attorney Jeremy Tedesco, senior vice president of corporate engagement for the Alliance Defending Freedom legal advocacy group, said conservatives have awakened to the reality that corporate culture no longer promotes the “essential supports of liberal democracy.”
“The increased conservative advocacy aimed at achieving these goals is welcome indeed,” Mr. Tedesco said.
The rising ideological tensions on display at shareholder meetings are also playing out on Capitol Hill and in state legislatures such as Florida.
Republican lawmakers have also moved on the state and federal levels to end tax benefits for companies that they say are engaging in partisan politics. Sen. Josh Hawley of Missouri on Tuesday introduced a bill that would strip the Disney Co. of special copyright protections granted by Congress and place shorter time limits on the lengths of new copyrights.