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Shareholders Press Tesla to Disclose Political Spending Thumbnail

Shareholders Press Tesla to Disclose Political Spending

Engagement News & Commentary

Newground Social Investment filed a shareholder proposal with Tesla Inc. (ticker: TSLA) that calls on the company to disclose its corporate political spending. 

The use of corporate money to influence elections and ballot measures adversely impacts a company's reputation, value, and bottom line. Transparency surrounding Tesla's political spending would improve oversight and foster trust with shareholders, while bringing the company in line with a growing number of Wall Street leaders. 

Unless the company significantly improves its disclosure, the proposal will be voted on at Tesla's 2025 annual shareholder meeting.  

The full text of the proposal appears below, and is also available in its original format as a downloadable PDF.

Disclosure of Political Spending

RESOLVED: Shareholders of Tesla Inc. (“Tesla” or “Company”) hereby request that the Company provide a report, updated semiannually, disclosing the Company’s:

  1. Policies and procedures for making, with corporate funds or assets, contributions and expenditures (direct or indirect) to (a) participate or intervene in any campaign on behalf of (or in opposition to) any candidate for public office, or (b) influence the general public, or any segment thereof, with respect to an election or referendum. 

  2. Monetary and non-monetary contributions and expenditures (direct and indirect) used in the manner described in section 1 above, including:
  • The identity of the recipient as well as the amount paid to each; and
  • The title(s) of the person(s) in the Company responsible for decision-making.

The report shall be presented to the board of directors or relevant board committee and posted on the Company’s website within 12 months from the date of the annual meeting.  This proposal does notencompass lobbying spending.

SUPPORTING STATEMENT

As long-term shareholders of Tesla, we support transparency and accountability in corporate electoral spending.  A company’s reputation, value, and bottom line can be adversely impacted by political spending.  The risk is especially serious when giving to trade associations, Super PACs, 527 committees, and “social welfare” organizations – groups that routinely pass money to or spend on behalf of candidates and political causes that a company might not otherwise wish to support.

The Conference Board’s 2021 “Under a Microscope” report warns “Political activity can pose increasingly significant risks for companies, including the perception that political contributions – and other forms of activity – are at odds with core company values.”

A recent poll of retail shareholders by Mason-Dixon Polling & Research found that 83 percent of respondents said they would have more confidence investing in corporations that have adopted reforms that provide for transparency and accountability in political spending.  Tesla scored 0.0 percent in the 2024 CPA-Zicklin Index of Corporate Political Disclosure and Accountability.

Publicly available records show Tesla has contributed at least $1 million in corporate funds since the 2010 election cycle.

This proposal asks Tesla to disclose all of its electoral spending, including payments to Trade Associations and 501(c)(4) social welfare organizations, which may be used for electoral purposes–and are otherwise undisclosed.  This would bring our Company in line with a growing number of leading companies, including The Boeing Company, PayPal Holdings Inc., and RTX Corporation, which present this information on their websites.

Without knowing the recipients of our company’s political dollars we cannot sufficiently assess whether our company’s election-related spending aligns or conflicts with its policies on climate change and sustainability, or other areas of concern.

THEREFORE: We urge your support for this critical governance reform.

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Note: This material is intended for educational purposes only. As with all our public writing, blog posts do not constitute tax, financial planning, or investment advice. Likewise, they are neither an offer to sell nor solicitation to buy any investment or security.