Since 2011, investors have filed over 600 shareholder proposals asking for lobbying disclosure reports that include federal and state lobbying amounts, payments to trade associations and social welfare groups used for lobbying, and payments to tax-exempt organizations that write and endorse model legislation. The proposal has been voted on at nearly 400 companies, produced more than 125 settlements for improved disclosure, and notched 13 majorities, including Exxon and McDonald’s.

With over 35 proposals filed, 2025 was shaping up as past years. However, a proposal at Air Products and Chemicals was challenged on three arguments: micromanagement, targeted organizations, and targeted specific lobbying. The micromanagement argument claimed the proposal sought 79 different pieces of information rather than a report of federal and state lobbying and all indirect lobbying through third parties. Given eight previous determinations that lobbying disclosure proposals did not seek to micromanage a company, first in 2011 and most recently affirmed in 2020, the SEC’s November 29 determination granting “no action” relief on micromanagement grounds was surprising.

The SEC’s decision opened the door for other challenges, with 22 more companies seeking to exclude proposals, at least 12 more exclusions approved, and seven others withdrawn. A new SEC Staff Bulletin released in February – after proponents had already filed most 2025 proposals – allows companies to revise their challenges to meet the new rules, but it does not allow proponents to revise their proposals, thus preventing them to meet the new rules.

Going forward, proponents will revise language to make clear the proposal is not seeking an unlimited number of complex items but rather a simple annual lobbying report as scores of other companies already do. Lobbying has been an established proposal and a priority for investors. The topic of political spending – both lobbying disclosure and political contributions – is year in and year out always one of the most voted on topics at shareholder meeting.

Not all companies have chosen to challenge lobbying proposals. Proponents have had a number of successes, settling at least 10 proposals after dialogue with company management and agreements for improved disclosure. And, a handful of proposals remain on schedule to be voted on. In addition to dark money risks, remaining proposals highlight lobbying misalignments, where company lobbying contradicts company public positions on issues including climate change, defense spending, corporate taxation, and funding nonprofits attacking ESG investing.