A Boston-based asset management company with Netflix holdings is demanding that the streaming giant better reveal its political lobbying efforts to mitigate potential “reputational risk,” according to a stockholder proposal filed Thursday with the Securities and Exchange Commission.
Boston Common Asset Management, which handles mutual funds and other assets for institutions and individuals, argued to formalize an annual lobbying report via Proposal 8, which is to go before Netflix shareholders for a proxy vote. Netflix has opposed Prop 8, saying an annual lobbying report would be duplicating current efforts.
Boston Common disagrees.
“The well-documented reputational risks of Netflix’s lobbying and its inadequate lobbying disclosure policies highlight the critical need for the Company to improve its lobbying disclosures and increase transparency around its lobbying policies, procedures and spending details,” reads the filing, signed by Lauren Compere, managing director/director of shareowner engagement at Boston Common.
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Among other things, Proposition 8 demands that Netflix codify its corporate lobbying policy and procedures; disclose payment amounts and recipients for both direct and indirect lobbying; disclose payments to tax-exempt organizations that stump for policy; and provide a “description of management’s and the Board’s decision-making process and oversight for making payments.”
The annual report, as proposed, would live publicly on the company’s website.
“Netflix’s failure to provide robust and complete disclosure of its lobbying activities and expenditures may expose it to potential reputational damage and therefore potential negative impacts on shareholder value,” the filing reads. “Heightened scrutiny of corporate spending on lobbying and other political expenditures potentially exposes companies to increased reputational risk.”
The filing included a summary of objections from Netflix, which did not immediately return messages left Thursday for comment.