United States
Securities and Exchange Commission
Washington, DC
20549
NOTICE OF EXEMPT
SOLICITATION
NAME OF REGISTRANT: Seventh
Generation Interfaith Inc.
NAME OF PERSONS
RELYING ON EXEMPTION: Province of Saint Joseph of the Capuchin Order
ADDRESS OF PERSON
RELYING ON EXEMPTION: 930 West State Street, Milwaukee WI 53233
WRITTEN MATERIALS:
The attached written materials are submitted pursuant to Rule 14a-6(g)(1) (the “Rule”) promulgated under the Securities Exchange
Act of 1934. Submission is not required of this filer under the terms of the Rule, but is made voluntarily in the interest of public disclosure
and consideration of these important issues.
Date:
April 3, 2023
To: Boeing Shareholders
Subject: Exempt Solicitation
on Shareholder Proposal — Additional Report on Lobbying Activities (Item #7)
Contact: Robert Wotypka, OFM
Cap, Province of Saint Joseph of the Capuchin Order
RECOMMENDATION:
The Province of Saint Joseph of the
Capuchin Order is urging shareholders to vote FOR the shareholder proposal requesting an additional report on lobbying activities
(Item 7 in the proxy statement) at the Boeing shareholder meeting on April 18, 2023.
RESOLVE:
The shareholders of Boeing request the preparation
of a report, updated annually, disclosing:
| · | Company policy and procedures governing lobbying, both direct and indirect,
and grassroots lobbying communications. |
| · | Payments by Boeing used for (a) direct or indirect lobbying or (b) grassroots
lobbying communications, in each case including the amount of the payment and the recipient. |
| · | Boeing’s membership in and payments to any tax-exempt organization
that writes and endorses model legislation. |
| · | Description of management’s and the Board’s decision-making process
and oversight for making payments described above. |
The proposal is part of an ongoing
investor campaign for greater corporate political spending and lobbying disclosure. Transparency and accountability in corporate
spending to influence public policy are in the best interests of Boeing shareholders. Without a clear system ensuring
accountability, corporate assets can be used to promote public policy objectives which can pose risks to Boeing’s reputation
and shareholder value.
2023 marks the tenth consecutive year that shareholders have filed this proposal. Reviewing the
company’s opposition statements over a ten-year span, the company’s arguments against providing greater transparency and
disclosure remain largely constant. Every year the company has rebutted this resolution by citing its performance on the CPA-Zicklin
Index. Described below are reasons why this index does not fully address the resolution’s asks. Events involving our company
over the ten years since first filing this resolution make transparency and disclosure of lobbying activities only more relevant and
necessary.
Boeing needs to commit to corporate
political responsibility by increasing its transparency through disclosing all of its third-party spending done to influence public policy.
We will show support for this proposal is warranted because:
| · | Reputation is an important component of shareholder value |
| · | Boeing’s current disclosures are inadequate |
| · | Dark money spending through trade associations and social welfare groups
presents unknown risks; and |
| · | Boeing could easily provide details of its lobbying to investors. |
Corporate Reputation Is an Important
Component of Shareholder Value
| · | Boeing’s failure to provide robust and complete disclosure of its lobbying
activities and expenditures exposes it to potential reputational damage. |
| · | The 2018 Reputation Dividend Report estimates that “corporate reputation
is now directly responsible for an average of 38% of market capitalization across the FTSE 100 & 250.”1 The Ipsos
Global Reputation Centre research across 31 countries shows conclusive proof of the relationship between a good reputation and better
business efficiency.2 |
| · | According to a Deloitte survey, 87 percent of executives rated reputation
risk as more important or much more important than other strategic risks their companies are facing, and 88 percent said their companies
are explicitly focusing on managing reputation risk.3 |
| · | Clearly, corporate reputation has significant impact on shareholder value. |
Disclosure Gaps - Boeing Investors Need
a Lobbying Report
| · | Information on Boeing’s federal, state and international lobbying
spending is difficult to obtain, limited and non-consolidated. Boeing fails to provide investors with a comprehensive lobbying report
where they can learn relevant amounts spent on direct or indirect lobbying activities/relationships, priorities, and how those efforts
are supportive of the company’s strategy and investor interests. Yet Boeing has a broad lobbying footprint. |
1 “Link Between
Corporate Reputation & Market Value Strengthens: Study,” Provoke Media, March 8, 2018, at: https://www.provokemedia.com/research/article/link-between-corporate-reputation-market-value-strengthens-study.
2 “Unlocking
the Value of Reputation,” Ipsos, May 2018, at: https://www.ipsos.com/sites/default/files/ct/publication/documents/2018-05/unlocking_value_of_reputation-may_2018.pdf
3 “2014 Global
Survey on Reputation Risk,” Deloitte, p. 4, at: https://www2.deloitte.com/content/dam/Deloitte/global/Documents/Governance-Risk-Compliance/gx_grc_Reputation@Risk%20survey%20report_FINAL.pdf
Federal Lobbying – Boeing Spends
Millions Each Year
| · | Boeing spent $206,050,000 on federal lobbying from 2010-2022, and $26,620,000
in 2021 and 2022 alone. Since 1998, Boeing has spent more than $328 million on federal lobbying, making it the 9th largest
spender during that time.4 |
| · | Boeing retains 17 outside lobbying firms for federal lobbying.5 |
| · | They have been described as “one of the US’s most powerful lobbyists6
and “one of the biggest players in the Washington influence game.”7 |
| · | Boeing has drawn scrutiny for “lobbying Congress to buy aircraft that
we don’t need.”8 |
| · | Yet Boeing fails to disclose its federal lobbying amounts to shareholders
as requested. |
| · | The geographic proximity to the nation’s capital, having moved the
corporate headquarters from Chicago to Arlington, Virginia, does not alleviate the necessity of increased disclosure. |
State Lobbying – Information
on Boeing’s Spending Difficult to Obtain
| · | Obtaining comprehensive state lobbying information is described by an expert
as “nearly impossible” given “the ‘Byzantine’ manner in which the data is captured and made available online”
which effectively buries information across many states’ websites.9 |
| · | Boeing fails to provide any details of its state lobbying expenditures as
requested by the proposal. Boeing only provides investors links to five state websites for California, Florida, Missouri, Texas and Washington.
This incomplete disclosure fails to provide the amounts, as requested. It also requires the user to look up Boeing’s reports. It
also fails to provide links to other state Boeing lobbies in, including Arizona, Illinois, Oklahoma, Oregon and South Carolina. |
| · | Boeing’s state-level lobbying spending is likely significant. According
to a 2017 study that looked at disclosures from the six states with the most robust reporting requirements, Boeing spent $1.3 million
between 2012 and 2015.10 |
| · | In California, Boeing spent $1.3 million from 2010 – 2022 on lobbying.11 |
International Lobbying
| · | Boeing also lobbies abroad, spending between €800,000 – €899,000
on lobbying in Europe for 2021.12 |
_____________________________
4 https://www.opensecrets.org/federal-lobbying/top-spenders?cycle=a.
5 “Subject Matter signs
Boeing,” Politico, March 22, 2023, at: https://www.politico.com/newsletters/politico-influence/2023/03/20/subject-matter-signs-boeing-00087950.
6 “Boeing’s 737
Max Fleet ‘Will Remain Grounded for Weeks,’” The Guardian, March 14, 2019, https://www.theguardian.com/world/2019/mar/14/ethiopian-airlines-boeing-737-max-black-boxes-arrive-paris,
accessed March 18, 2019.
7 “Boeing a Major Lobbying
Player on Capitol Hill,” CNN, March 13, 2019, https://www.cnn.com/2019/03/12/politics/boeing-capitol-hill-lobbying/index.html,
accessed March 18, 2019.
8
“Navy admiral criticizes defense contractors over lobbying efforts,” The Hill, Aug. 3, 2021, at: https://thehill.com/business-a-lobbying/business-a-lobbying/566189-navy-admiral-criticizes-defense-contractors-over.
9 “Wal-Mart Improves
Lobbying Disclosure after Shareholder Push,” Reuters, May 13, 2015, https://www.reuters.com/article/us-wal-mart-stores-disclosure-lobbying-e/exclusive-wal-mart-improves-lobbying-disclosure-after-shareholder-push-idUSKBN0NY0AH20150513,
accessed March 18, 2019.
10 Heidi Welsh and Robin
Young, “How Leading U.S. Corporations Govern and Spend on State Lobbying,” Sustainable Investments Institute and The Investor
Responsibility Research Institute, February 2017, p. 30.
11 https://cal-access.sos.ca.gov/Lobbying/Employers/Detail.aspx?id=1146240&view=activity&session=2021.
12 https://ec.europa.eu/transparencyregister/public/consultation/displaylobbyist.do?id=62505293737-81.
| · | Boeing recently hired IBM’s lobbyist to be its “EU and NATO lobbying
chief” and sent another veteran lobbyist to Brussels.13 |
| · | Boeing has attracted scrutiny for funding the EU Reporter, described as “EU
lobbying dressed up as journalism.” EU Reporter reportedly presents its coverage as straight news — with rarely an indication
that a company or government paid for, or was associated with, the articles. And when the publication’s articles touch on one of
its clients, that coverage is frequently positive.14 |
The Company We Keep: Boeing Does
Not Provide Comprehensive Dark Money Disclosure
| · | Shareholder proposals for lobbying disclosure capture dark money spending
where there are no limits on what a company can give, whether through trade associations (TAs) or social welfare group (SWGs). While corporate
donations to politicians and traditional PACs have strict limits, their payments to TAs and 501(c)(4) SWGs have no restrictions, meaning
companies can give unlimited amounts to third party groups that spend millions on lobbying and often undisclosed grassroots activity. |
| · | Undisclosed company payments/dark money lobbying by trade associations and
social welfare groups may be “at least double what is being reported.”15 In 2017, TAs and SWGs spent $535 million
on disclosed lobbying and $675 million on unregulated efforts to influence public policy, including strategic consulting, broadcast advertising,
media relations, social media posts, polling and funding for astroturf campaigns. |
Boeing’s Trade Association
Blind Spot, Disclosure Lags Peers
| · | Boeing’s disclosures of its participation and memberships in Trade
Associations is limited, lacking details on payments and the portions used for lobbying, alignment with corporate priorities, and process
and engagement. |
| · | Corporations make payments to trade associations that are used lobby indirectly
on their behalf without specific disclosure or accountability. Trade associations spend hundreds of millions to lobby. For example, the
US Chamber of Commerce has spent more than $1.8 billion since 1998.16 |
| · | Boeing shareholders face a trade association blind spot, as Boeing fails
to disclose a closed limit for its trade association payments. Its 2021 trade association disclosure notes Boeing belonged to 13 trade
associations which received more than $50,000 in dues.17 All a reader can tell from this is that these organizations received
over $50,000. There is no way for a reader to know whether these trade associations received $50,001, $500,000 or $5,000,000 in dues.
Not knowing is a problem for shareholders. It is also unclear whether this disclosure captures payments in addition to dues made to trade
associations, or the portions of these payments used for lobbying. |
_____________________________
13 “Defense lobbyists
send their big guns to Brussels,” Politico, March 23, 2023, at: https://www.politico.eu/article/defense-policy-lobby-european-union/.
14 “Dark news: The
murky world of undercover EU lobbying,” Politico, Sept. 15, 2021, at: https://www.politico.eu/article/brussels-eu-media-peddling-undisclosed-influence/.
15 “Business Group
Spending on Lobbying in Washington at Least Double What’s Publicly Reported,” The Intercept, Aug. 6, 2019, at: https://theintercept.com/2019/08/06/business-group-spending-on-lobbying-in-washington-is-at-least-double-whats-publicly-reported/.
16 https://www.opensecrets.org/federal-lobbying/top-spenders?cycle=a
17 https://www.boeing.com/resources/boeingdotcom/company/key_orgs/pdf/Trade_Association_Disclosure_2021.pdf
| · | For example, Boeing belongs to the Aerospace Industries Association of America,
Business Roundtable, National Association of Manufacturers and US Chamber Commerce, which together spent $112,360,000 on lobbying for
2021. Yet all a reader can tell is that Boeing gave each of these groups more than $50,000 and they used 20 to 60 percent of Boeing’s
dues for lobbying. Did Boeing give the Chamber $100,000 with $25,000 used for lobbying, $1,000,000 with $250,000 used for lobbying, or
$5,000,000 and $1,250,000 for lobbying? Without disclosing the amounts, there is no way to know. A reader cannot tell if Boeing is making
very large payments which are being used to influence public policy. |
| · | Boeing’s incomplete third-party disclosure lags many of its peer group
members which are providing disclosure of their trade association and social welfare group payments and the amounts used for lobbying.
This group includes 3M, AT&T, Chevron, Cisco, ExxonMobil, Honeywell, Intel, Lockheed Martin, Microsoft, Northrop Grumman, Procter
& Gamble and Raytheon.18 |
Trade Association Lobbying Misalignments
Create Reputational Risk
| · | We believe Boeing’s trade association memberships and payments used
for lobbying pose reputational risks and risks to long-term sustainable growth when the lobbying by its trade associations contradicts
Boeing’s public position, including on climate, voter rights and taxes. |
| · | Boeing notes the issue of sustainability alignment with its environmental
goals and commitments could harm its reputation. In its 2022 10-K, Boeing notes “in alignment with our sustainability priorities,
we establish and publicly announce goals and commitments to improve our environmental performance, such as our recent operational goals
in areas of GHG emissions, energy, water and waste. If we fail to achieve or improperly report on our progress toward achieving our sustainability
goals and commitments, the resulting negative publicity could adversely affect our reputation and/or our access to capital.”19 |
| · | We are concerned that Boeing’s lack of disclosure presents reputational
risk when its lobbying contradicts company public positions or takes controversial positions. For example: |
| o | Boeing believes in addressing climate change,20 yet the Business Roundtable lobbied against the Inflation Reduction Act21
and the Chamber of Commerce opposed the Paris climate accord.22 |
_____________________________
18 Intel, Procter & Gamble
and Raytheon disclose their trade association and social welfare group payments, as well as the portions used for lobbying. Cisco, Microsoft
and Northrop Grumman disclose their trade association payments, as well as the portions used for lobbying. AT&T, Chevron and ExxonMobil
disclose their trade association and social welfare group payments used for lobbying. 3M, Honeywell and Lockheed Martin disclose their
trade association payments used for lobbying.
19 Boeing 2022 10-K, p. 15.
20 http://www.boeing.com/principles/environment/report/index.page
21 “How a top US business
lobby promised climate action – but worked to block efforts,” The Guardian, Aug. 19, 2022, at: https://www.theguardian.com/environment/2022/aug/19/top-us-business-lobby-group-climate-action-business-roundtable.
22 “Paris Pullout Pits
Chamber Against Some of Its Biggest Members,” Bloomberg, June 9, 2017, at: https://www.bloomberg.com/news/articles/2017-06-09/paris-pullout-pits-chamber-against-some-of-its-biggest-members
| o | Boeing signed a statement opposing state voter restrictions, yet the Chamber lobbied against the For the People Act.23 |
| o | While Boeing has previously drawn scrutiny for avoiding federal taxes,24 the Chamber and the Business Roundtable lobbied
against raising corporate taxes to fund health care, education and safety net programs.25 |
| o | This track record of Boeing’s trade associations acting in contrast to the Company’s stated values and positions heighten
its reputational risk. Without more comprehensive disclosure, shareholders cannot determine whether Boeing is effectively able to prevent
Company funds from being used for lobbying efforts contrary to the Company's and shareholders’ objectives and long-term interests. |
Social Welfare Groups are “Perfect
Entity to Receive a Bribe”
| · | Boeing’s disclosure notably leaves out SWGs (501(c)(4) organizations),
entities which can engage in lobbying. |
| · | FirstEnergy’s trial over $60 million of dark-money payments led a prosecutor
to note that a social welfare group is “a perfect entity to receive a secret bribe.”26 |
| · | The dark money scandal at FirstEnergy illustrates why investors need disclosure
of SWG spending to prevent reputational, regulatory and financial damage. FirstEnergy agreed to pay $230 million for funneling $60 million
through a dark money SWG group called Generation Now that was used for bribery in Ohio.27 |
| · | Boeing supports controversial “dark money” social welfare organizations
like the American Action Network.28 American Action Network recently drew attention for targeting Democratic lawmakers with
a $2 million ad campaign making “false claims that Biden will cut Medicare.”29 |
Boeing’s Trade Association
Ties to American Legislative Exchange Council
| · | Boeing does not belong to the American Legislative Exchange Council. However,
Boeing is represented at ALEC by its trade associations. For example, the Chamber is a member, serving on ALEC’s Private
Enterprise Advisory Council.30 And the National Association of Manufacturers previously sat on the Private Enterprise Advisory
Council as well. |
_____________________________
23 Watchdog group launches
campaign pressuring companies to leave Chamber of Commerce over voting rights, The Hill, May 20, 2021, at: https://thehill.com/business-a-lobbying/business-a-lobbying/554430-watchdog-group-launches-campaign-to-pressure?rl=1.
24 “Boeing Paid Tax
Rate of 8.4% in Previous Decade, But Trump to Speak About Why It Needed His Corporate Tax Cut,” Institute on Taxation and Economic
Policy, March 14, 2018, at: https://itep.org/boeing-paid-tax-rate-of-8-4-in-previous-decade-but-trump-to-speak-about-why-it-needed-his-corporate-tax-cut/.
25 “Corporate America
launches massive lobbying blitz to kill key parts of Democrats’ $3.5 trillion economic plan,” Washington Post, Aug.
31, 2021, at: https://www.washingtonpost.com/us-policy/2021/08/31/business-lobbying-democrats-reconciliation/.
26 “Ohio Republicans
accused of taking $60m in bribes as corruption trial opens,” The Guardian, Jan. 24, 2023, at: https://www.theguardian.com/us-news/2023/jan/23/ohio-republican-larry-householder-corruption-trial.
27 https://apnews.com/article/business-government-and-politics-ohio-a4dd75020561d8b533fdabcb98a0a350.
28 “Boeing’s
Political Ties and the Decision to Ground the 737 Max,” New York Times, March 15, 2019, at: https://www.nytimes.com/2019/03/15/opinion/boeing-crash-contractor-trump.html.
29 “Dark money group
targets House Democrats with false claims that Biden will cut Medicare,” American Independent, March 6, 2023, at: https://americanindependent.com/dark-money-american-action-network-house-democrats-joe-biden-medicare-ads/.
30 https://www.alec.org/group/private-enterprise-advisory-council-2/
| · | ALEC has been attacking “woke capitalism”31 It has
drafted two “anti-ESG” model legislation bills.32 ALEC has attracted negative attention for its role in promoting
bills that undermine regulations to address issues like climate change, workplace safety and workers’ rights. ALEC has also attracted
attention for “numerous ties to the Capitol insurrection and Big Lie” challenging the validity of the election results,33
as well as promoting voter suppression34 and critical race theory.35 |
Boeing’s Opposition Statement
is Inaccurate and Inadequate
| · | Boeing continues to claims this proposal is unnecessary. |
| · | Boeing claims it is “deeply committed to political transparency,”
yet it opposes this proposal asking for lobbying transparency. |
| · | Boeing continues to discuss a high ranking for political contributions disclosure,
yet this proposal is asking for lobbying disclosure. It is disingenuous and misleading for our company to confuse this point year after
year. Boeing’s CPA-Zicklin ranking has nothing to do with lobbying spending disclosure. |
| · | CPA-Zicklin, to address companies using the index as a bulwark against lobbying
disclosure and transparency, issued a “purpose and misuse statement” in 2022. The statement reads: “The Index does not
make a value judgment on a company’s political spending or alignment with its publicly stated values and does not cover company
lobbying spending or activities” (emphasis added).36 |
| · | We applaud the company for its performance on the CPA-Zicklin Index, but
it is akin to responding to a cardiologist’s concern about a patient’s high blood pressure by pointing to an ophthalmologist
stating there is no need for new lenses. These are separate issues. Boeing states it is listed as a “trendsetter” for political
contributions disclosure. For lobbying disclosure, Boeing is a laggard among its peers. |
_____________________________
31 “Abandoning Free
Market and Liberty Principles, ALEC Takes on ‘Woke Capitalism,’ Bodily Autonomy, and More at Its Annual Meeting,” Center
for Media and Democracy, July 27, 2022, at: https://www.exposedbycmd.org/2022/07/27/abandoning-free-market-and-liberty-principles-alec-takes-on-woke-capitalism-bodily-autonomy-and-more-at-its-annual-meeting/.
32 “ALEC Eyes Sweeping
Government Blacklists,” Center for Media and Democracy, Nov. 10, 2022, at: https://www.exposedbycmd.org/2022/11/10/alec-eyes-sweeping-government-blacklists/.
33 “ALEC’s Numerous
Ties to the Capitol Insurrection and ‘Big Lie,’” Center for Media and Democracy, Jan. 27, 2021, at: https://www.exposedbycmd.org/2021/01/27/alecs-numerous-ties-to-the-capitol-insurrection-and-big-lie/
34 “CMD Joins 300+
Groups in Call for Companies to Quit ALEC Over Voter Suppression Bills,” Center for Media and Democracy, June 14, 2021, at:
https://www.exposedbycmd.org/2021/06/14/cmd-joins-300-groups-in-call-for-companies-to-quit-alec-over-voter-suppression-bills/.
35 “Critical Race Theory
Gives Business Leaders Yet Another Reason to Quit ALEC,” Triple Pundit, July 21, 2021, at: https://www.triplepundit.com/story/2021/critical-race-theory-alec/725786.
36
“Center for Political Accountability Statement on the
CPA-Zicklin Index, What It Benchmarks and Its Purpose” at: https://www.politicalaccountability.net/wp-content/uploads/2022/06/CPA-Zicklin-Index-Purpose-and-Misuse-Statement-6.27.22.pdf
| · | Boeing “believes that a proposal seeking an additional report containing
much of the same data we already disclose would not add value to shareholders, yet would result in the expenditure of additional resources
by the Company.” The claim a report would result in expenditures of additional resources is misleading. Other companies are able
to provide this information shareholders. Peer ExxonMobil puts out an annual lobbying report37
capturing federal, state and grassroots lobbying and including all of its payments to third parties used for lobbying, showing this can
be done.38 If Exxon can put out a report, so can companies like Boeing. |
| · | Boeing is required to report its federal and state lobbying, knows what its
pays trade associations and social welfare groups, and has all of this information. It could be readily provided to shareholders in a
single report at minimal expense. |
***
Conclusion
Last year’s proxy had an entire
section devoted to “Rebuilding Trust.” We believe that lobbying disclosure is low-hanging fruit pursuing that endeavor,
We encourage all interested investors
to take a look at Boeing’s existing disclosures and assess: do they currently provide you with a clear idea of how and where the
company is lobbying; to what end and with what efficacy; and how are those activities aligned with your interests? Could you cite a number
that represents how much the company has spent on influencing public policy, directly or indirectly, and with what partners, and on what
issues? Beyond its activities in the US, do you have a clear understanding of how the company attempts to impact policies in non-US jurisdictions?
If you find that the company’s
current level of transparency and disclosure is not sufficient to address these matters, we ask you to vote in support of this proposal.
Lobbying Transparency: What Gets
Disclosed Gets Managed.
What we have argued are Boeing’s
inadequate lobbying disclosure practices highlight the critical need for the Company to improve its lobbying disclosures, and increase
transparency around its lobbying policies, procedures and spending details.
| · | If Boeing has nothing to hide, transparent disclosure would simply show that
its lobbying is being done for the company and shareholders’ best interests. |
| · | Knowing our company’s lobbying will be disclosed will ensure board
and management oversight to safeguard that lobbying is being done in shareholder and Boeing’s best interests, which can be protective
of our investment now and in the future. |
For all of the above reasons, we urge
shareholders to vote FOR Item 7, the shareholder proposal requesting a report on the Company’s lobbying expenditures.
Sincerely,
Robert Wotypka, OFM Cap.
Corporate Responsibility Agent
Province of Saint Joseph of the Capuchin
Order
_____________________________
37 https://corporate.exxonmobil.com/-/media/global/files/policy/lobbying/exxonmobil-2021-lobbying-report.pdf.
38 “Exxon Mobil’s
lobbying report sets benchmark, ESG advocates say,” Roll Call, March 10, 2022, at: https://rollcall.com/2022/03/10/exxon-mobils-lobbying-report-sets-benchmark-esg-advocates-say/.
NOTE: This is not a solicitation
of authority to vote your proxy. Please DO NOT send us your proxy card; The Province of Saint Joseph of the Capuchin Order (POSJ) is not
able to vote your proxies, nor does this communication contemplate such an event. POSJ urges shareholders to vote for Item 7 following
the instructions provided on management's proxy mailing.
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